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Full text of "Hearing"

V 




San Francisco Public Library 

Government Information Center 
Sar Francisco Puhlic Library 
lOOLaikin Street, 5th Floor 
Ssn Francisco, C A 94 102 



I 



REFERENCE BOOK 

Not to be taken from the Library 



<^.HEARING 

^SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 

THURSDAY, JUNE 6, 1996 
11:30 A.M. 



JUL 1 2 1996 

SAN FR^Si^C?«i.'JO 
PUBLIC^ UBRARY 



304-R 



Reported by 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 



THURSDAY, JUNE 6, 1996 
11:30 A.M. 



Evelyn J. Mizak 
Shorthand Reporter 



3 1223 03273 6655 



11 



APPEARANCES 

MEMBERS PRESENT 

SENATOR WILLIAM LOCKYER, Chair 

SENATOR ROBERT BEVERLY, Vice Chair 

SENATOR RUBEN AYALA 

SENATOR JOHN LEWIS 

SENATOR NICHOLAS PETRIS 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 

PAT WEBB, Committee Secretary 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

GEORGE M. GALAZA, Warden 

North Kern State Prison at Delano 

Department of Corrections 

FRANK SEARCY, President 

Chicano Correctional Workers Assocation 

GEORGE NICHOLAW, Member 
California Horse Racing Board 

ROD BLONIEN 

Thoroughbred Owners of California 
Horsemen's Quarterhorse Racing Association 
Cal Western Appaloosa Association 

RALPH M. SCURFIELD, Member 
California Horse Racing Board 

CAROLYN PAGE 

Alleged Assault Victim at Hollywood Park 



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Ill 
INDEX 

Page 
Proceedings 1 

Governor ' s Appointees : 

GEORGE M. GALAZA, Warden 

North Kern State Prison at Delano 

Department of Corrections 1 

Questions by CHAIRMAN LOCKYER re: 

Review of Employment History 1 

Problems with Overcrowding 1 

Number of Inmates Involved in 

Literacy Program 3 

Literacy Programs System-wide 3 

Questions by SENATOR AYALA re: 

Over-time Policy at Institution 4 

Contractual Agreements Governing 

Staff Over-time Assignments 5 

Drugs in Prison 5 

Escapees 7 

Witness in Support: 

FRANK SEARCY, President 

Chicano Correctional Workers Association 8 

Motion to Confirm 9 

Committee Action 10 

GEORGE NICHOLAW, Member 

California Horse Racing Board 10 

Questions by CHAIRMAN LOCKYER re: 

Direction of California Horse Racing 

and Problems or Concerns 11 

Drug Testing and Use of Illegal 

Medications 11 

Questions by SENATOR AYALA re: 

Card Rooms within Race Track Premises 12 



IV 



Questions by CHAIRMAN LOCKYER re: 

Responsibilities to Evaluate 

Employees that Work for the Board 13 

Issues that Come Up 13 

Evaluation of Stewards 14 

Witness in Support: 

ROD BLONIEN 

Thoroughbred Owners of California 

Horsemen's Quarterhorse Racing Association 

Cal Western Appaloosa Association 14 

Motion to Confirm 15 

Committee Action" 15 

RALPH M. SCURFIELD, Member 

California Horse Racing Board 15 

Questions by CHAIRMAN LOCKYER re: 

Nature of Scurf ield Company 16 

Drug Testing and Illegal Medication 

Policies of Board 16 

Witness in Opposition: 

CAROLYN PAGE 

Victim of Alleged Sexual Assault 17 

Questions by CHAIRMAN LOCKYER re: 

Nominee's Familiarity with Complaint 18 

Involvement of Inglewood Police Department 

and District Attorney ' s Office 19 

Letter from Mr. Wood dated 

June 5, 1996 20 

Board's Policy on Policing Facilities, 

Safety of Patrons, and Sexual Harassment 22 

Possibility of Training Board and Staff 

about Sexual Harassment 23 



witness in Support: 

ROD BLONIEN 

Thoroughbred Owners of California 

Horsemen's Quarterhorse Racing Association 

Cal Western Appaloosa Association 23 

Motion to Confirm 24 

Committee Action 24 

Termination of Proceedings 24 

Certificate of Reporter 25 



P-R-0-C-E-E-D-I-N-G-S 
— ooOoo — 

CHAIRMAN LOCKYER: Good afternoon. Did you wish to begin 
with any opening comment at all? 

MR. GALAZA: First of all, you asked me to be here today, 
in front of the Committee and in front of the Chairman, and I'm 
prepared to answer questions. 

CHAIRMAN LOCKYER: You've been Warden there now since, 
what, last fall. Prior to that, various positions in the 
Department. Could you review those quickly for us? 

MR. GALAZA: Sure. I have a total of seventeen years of 
state service. The first three years was with the California 
Youth Authority, and the remaining fourteen years have been with 
the Department of Corrections. 

And in those seventeen years, I have worked at 
approximately six different institutions, plus a stint in 
Headquarters. The assignments have run the gamut of positions in 
rank and file, supervisorial, and managerial. 

Prior to becoming the Warden in North Kern State Prison, 
my assignment was as a Chief Deputy Warden at the California 
Institution for Men in Chino. 

CHAIRMAN LOCKYER: All right. You have, like all of the 
prisons, some overcrowding in your facility. Does it cause you 
any specific problems or anxieties that you might want to tell us 
about? 

MR. GALAZA: Well, overcrowding's always a concern in 
terms of the control of the inmates, and also in terms of 
programming, but one of the things we've been very successful at 



1 in terms of dealing with the overcrowding issue is in providing 

2 programs and activities for the inmates. 

3 I think one of the basic philosophies of the Department 

4 Director and myself in my assignments is that it is very 

5 important that the inmates do not have so much leisure time that 

6 it becomes a concern. So to that end, we provide a variety of 

7 assignments in terms of vocational and educational opportunities. 

8 We also have a variety of assignments in terms of work 

9 activities. To the extent that out of a total — our average 

10 population averages approximately 4,400, with the Reception 

11 Center included. I have over 92 percent of my inmates employed 

12 in either gainful occupation, or they're attending a vocational 

13 or academic program. 

14 CHAIRMAN LOCKYER: How much of the day would that occupy? 

15 MR. GALAZA: That would occupy — actually, it occupies a 

16 full 16 hours, if you take into consideration that some of the 

17 assignments overlap into what we would call Third Watch; 

18 basically a 2:30 to 10:30 position. 

19 So, there's quite a bit of activity time. There's quite a 
2 bit of actual assignment time. 

21 And in terms of leisure time activities, we've got — 

2 2 there's a variety of leisure time activities that most prisons 

2 3 have, which are the televisions, of course, and the usual things 

24 that are provided. But we also have a couple of other things 

2 5 that I think are relatively unique, and that is the Literacy 

2 6 Program. 

27 We have currently about 20 inmates, 20 tutors, that we 

2 8 have trained to tutor other inmates in the area of reading. And 



the majority of the tutelage comes on the Third Watch shift, 
basically an evening shift. And so, those inmates also take up 
quite a bit of the slack on quite a bit of the time that would 
normally be spent watching television, or writing letters, and 
what-have you, tutoring inmates in terms of their literary 
capacities. 

CHAIRMAN LOCKYER: How many involved in that? 

MR. GALAZA: Well, we have about 20 tutors right now. 

CHAIRMAN LOCKYER: And the students? 

MR. GALAZA: These are students. 

CHAIRMAN LOCKYER: How many students do they tutor? 

MR. GALAZA: They're tutoring anywhere from 50 to 70 at 
this point in time. We're hoping to expand that as time goes on. 

CHAIRMAN LOCKYER: Have you heard of or seen other 
literacy programs that seem to have successful outcomes in any of 
the prison settings? Is this a thing commonly discussed 
throughout the system? 

MR. GALAZA: I think at this point in time, the tutoring 
and the literacy programs are a very big topic of discussion 
within the Department. And I know, to the extent that I have 
talked to other wardens, that many other wardens are involved in 
this program at this point in time, because it basically, it 
serves a dual purpose. It does expand the scope of activities 
within the institution, it does provide for relatively calmer 
program, but on the other side of the coin, it also helps the 
inmates. And it provides them with the ability to have a 
structured reading program, a level of opportunity to get a level 
of comprehension that, perhaps, they might not have otherwise. 



And again, whether they're doing three years, fifteen 
years, a year-and-a-half , one would hope that some of the skills 
that they may pick up within the system can be translated to 
making them better people once they're leased in the community. 

CHAIRMAN LOCKYER: Are there questions from Members at 
all? 

SENATOR AYALA: Mr. Galaza, I'd like to ask you about the 
over-time at the North Kern facility. 

You have one of the largest in the state, 164.7 million 
for '93-94. You weren't there at the time, in '93-94? 

MR. GALAZA: No, I was initially at North Kern State 
Prison during the activation in 1993. 

SENATOR AYALA: Is the policy of giving senior members 
first option on over-time? They get paid more, of course, if 
they get more over-time, as opposed to junior members who have to 
wait until the seniors refuse the over-time, or they can't do it. 

What is the policy at the institution for over-time? 

MR. GALAZA: Well, the policy that we have at the 
institution for over-time is that which the Director has 
mandated, and basically that is, to manage over-time hours at the 
minimum hours allowed to maintain the safety and security of the 
prison. 

So, my mandate is to ensure that I hold over-time dollars 
down to that minimum. To that end, we have a number of methods 
that we deal with that. Some of the methods are governed by 
contractual responsibilities, particularly the bargaining Unit 6. 

Your question concerning the seniority, where the 
seniority issues comes into play, and yes, under those 



contractual obligations, over-time shifts that are available 
would tend to go toward the most senior member. 

However, we have other ways of controlling the over-time 
in that area, so that on many, many occasions, that doesn't even 
become a necessity. And some of those ways, of course, are 
basically how you post your position; basically how you provide 
the relief position to attend to the full-time positions. Also 
it includes the usage of permanent intermittent employees, which 
come in at a much lower dollar figure. 

So, we try to use a variety of means prior to actually 
filling an over-time position with the most senior individual. 
And again, that's a cost savings issue. 

SENATOR AYALA: Is that contractual agreement with CCPOA 
that determines how the over-time is given to the staff? 

MR. GALAZA: In terms of seniority? 

SENATOR AYALA: You don't have much control over that, 
then. 

MR. GALAZA: Well, the control, as I said, comes from our 
abilities to manage those over-time dollars through the means 
that I explained. It's still a factor. 

SENATOR AYALA: Who gets the over-time is determined by 
negotiating with CCPOA. 

MR. GALAZA: By the contractual responsibilities that we 
have with them, correct. 

SENATOR AYALA: I always ask everyone coming for 
confirmation about the drugs, and the inmates' usage themselves. 
I'm always amazed to find out so much trafficking going on. 

I'm told that at the CRC, there's more drugs inside and 



outside the prison, and I don't understand how that happens? I 
know that we've tried sniffing dogs in Chino, and the bleeding 
hearts people decided that was a little offensive to the people 
coining to visit. But it served a purpose, as far as I'm 
concerned. 

As it is today, I'm still told that a lot of drugs are 
within the confines of the prison facility, and that inmates are 
involved to a good extent. 

Is that true, that you're aware of? 

MR. GALAZA: There are drugs within the confines of the 
facilities. And drug trafficking and contraband trafficking 
within facilities are, of course, a major concern for those of us 
that have that managerial responsibility to run a prison. 

We take that very seriously. To that end, what we've done 
is that, under the premises of the Penal Code and under policy, 
we practice contraband surveillance and drug surveillance on a 
constant 2 4 -hour basis. 

There's a number of opportunities for contraband to enter 
the facilities because there's interaction with visitors, there's 
interaction with staff, there's interaction with volunteers. 

But to that end, we identify all those areas that have the 
greatest possibility for the introduction of contraband, and also 
the leaving of contraband, because certainly, as much as I don't 
want contraband in my facility, I don't want to be a vehicle for 
contraband going to other facilities or out to the community on a 
parole. 

So to that end, we provide training to all our staff. 
When I say all our staff, I mean all our staff, not just the 



peace officers, but the ancillary staff also. To that end, in 
terms of recognizing contraband, to assist us in our detection, 
to the peace officers specifically, the recognition of 
contraband, how it comes in. And then we set into place policy 
that will allow us to routinely and regularly search and review 
all areas where the possibility of contraband can be. 

And that's a 2 4 -hour job. It's not something that we 
begin at 8:00 o'clock in the morning and end at 4:30 in the 
afternoon. 

SENATOR AYALA: We don't hear very much any more about 
escapees. I know it happens quite a bit. CIM was like a 
revolving door there for awhile until it toughened up, and we had 
the perimeter fence at CIM, in which I was involved in pushing 
for that money for those within the area where they hang around, 
not the working area. 

The last one that escaped from Chino was from the farming 
area up there, where they were involved in the minimum security 
area. But since they put that perimeter fence up, there's been 
very few, if any, escapees. 

How about your facility? Are you quite able to control 
that, the escapees, than you were before? 

MR. GALAZA: Well, I think that the issue of the 
electrified fence has certainly added to the security of the 
prison. 

But I am always reminded that no matter how many fences we 
may have, in all honesty, it's no substitute to making sure that 
your policies in how you govern inmates, your policies and your 
programs are sound and as tight as possible. 



And I honestly believe that the issue of training the 
staff, the issue of policy, the issue of being totally aware of 
your programming needs and functions out there, is almost as 
important as having those fences around the prison. 

And I think the two in conjunction with each other is what 
makes that a safe institution for the community. 

SENATOR AYALA: I agree with your statement, that no 
matter how many fences you build, there'll be someone escaping 
from the toughest prison in the world. 

MR. GALAZA: Policy's extremely important, and the 
governing of those policies. 

SENATOR AY ALA: Thank you. 

CHAIRMAN LOCKYER: Are there further questions? 

I might ask for anyone who wishes to comment. I think 
it's unnecessary, and we'll be moving along here expeditiously, 
but last opportunity to ask a question before I call on Senator 
Beverly. 

Yes, sir. 

MR. SEARCY: Thank you again for allowing me this 
opportunity to speak on behalf of Mr. Galaza. 

I am Frank Searcy, President of the Chicano Correctional 
Workers Association. 

At this moment, I'd like to interrupt myself, and want to 
share with you that my colleague, Willy Nabory, the President of 
the Black Correctional Workers Association, also intended to be 
here. In fact, he's probably at the Sacramento Airport right 
now. He, unfortunately, received the incorrect time of 1:30. 

But I have spoken with him, and he has shared with me in 



the past that what I am going to share with you, his association 
also is of the same opinion. 

What I'd like to share with you is that the Chicano 
Correctional Workers Association supports Mr. Galaza, and as 
described already, his administrative ability is without 
question. And his 17 years of state service, and when they add 
that, and remind that that has been in both the — what we refer 
to as the custodial classification in the institution and the 
noncustodial classifications also, which gives him more of a 
broader, rounded experience to be able to administer an 
institution. 

So with that, again, thank you very much. 

CHAIRMAN LOCKYER: Thank you very much. 

We also, I might note for the record, have a letter from 
Senator Costa, who is a very strong advocate for the 
confirmation. 

Senator Beverly. 

SENATOR BEVERLY: Move we recommend confirmation. 

CHAIRMAN LOCKYER: All right, we have that motion before 
us. If you'd call the roll, please. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. 

SENATOR LEWIS: Aye. 

SECRETARY WEBB: Lewis Aye. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 

SENATOR BEVERLY: Aye. 



10 

SECRETARY WEBB: Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Five to zero. 

CHAIRMAN LOCKYER: Thank you, sir. Good luck to you. 

MR. GALAZA: Thank you. On behalf of myself, my family, 
and the Department of Corrections, I thank you, Mr. Chairman, and 
the Members of this Committee. 

CHAIRMAN LOCKYER: Mr. Nicholaw is next. Good afternoon. 
Nice to see you again. 

MR. NICHOLAW: Good afternoon, everybody. 

CHAIRMAN LOCKYER: Do you want to start with any opening 
comment about the Horse Racing Board duties and why you want to 
keep doing that? 

MR. NICHOLAW: Mr. Chairman, four years ago, I came before 
this Committee, and I said I was really looking forward to this 
opportunity. And I found that I really liked it. 

CHAIRMAN LOCKYER: Oh, good. 

MR. NICHOLAW: I really did. It's been an eye-opening 
experience. It's a wonderful opportunity to contribute to the 
well being of the State of California, and I've really enjoyed 
it. 

CHAIRMAN LOCKYER: I guess we might ask some of the 
questions we routinely look into with respect to these 
appointees. Of course, you're unlike, say, a warden who, that's 
not only his full-time job, but probably a couple of jobs. 

MR. NICHOLAW: Right. 

CHAIRMAN LOCKYER: We're relying on citizens like yourself 
to help as, in effect, volunteers to make the state better. And 



11 

I think we're appreciative of the fact that you're willing to do 
that. 

Do you have any sort of general sense about the direction 
of horse racing in California, and what you would regard as the 
most significant problems or concerns that we should consider for 
the future? 

MR. NICHOLAW: Well, as every industry today is facing 
greater and greater challenges, the horse racing industry in the 
State of California is a tremendous revenue producer for the 
state, and its challenges are growing by the day. 

And it really is the responsibility of all of us on the 
Horse Racing Board to see how we can grow the industry in the 
days ahead, and I think that is our biggest effort right now. 

CHAIRMAN LOCKYER: Anything that looks like it might be 
successful? 

MR. NICHOLAW: Well, it really depends, I think, on a lot 
of things, including the gaming industry from the standpoint of 
what's transpiring with the Indian casinos, and what-have you 
from that area. 

CHAIRMAN LOCKYER: There often have been complaints about 
illegal medications, and drug testing, and things of that sort. 

Is that a matter that comes before you as a Board member 
with any regularity? 

MR. NICHOLAW: It does come before the Board, you know, 
generally speaking, because every time there is a positive, you 
are informed about that. 

I'm a member of the Medication Committee, and during the 
past four years, great strides have really been made in trying to 



12 

provide the best possible results that they can get in the 
testing process. And I think that that has been emulated across 
the nation by other racing boards because of what we have done 
here in the State of California. 

CHAIRMAN LOCKYER: So, it's your feeling that at least the 
misuses are getting better policed? 

MR. NICHOLAW: Oh, absolutely. There's no question about 
that. 

CHAIRMAN LOCKYER: Are there any questions from Members? 
Senator Ayala. 

SENATOR AYALA: I'd like to ask him about the card rooms. 

Card rooms are spreading all over now, and I just wonder, 
what are your feelings about having the card rooms within the 
premises of the race track? 

MR. NICHOLAW: Well, they are trying that right now at 
Hollywood Park. They have a casino there, and I think generally 
speaking, it has been helpful to the horse racing industry, 
having that additional venue there at the same facility, because 
they do provide the opportunity for people that participate at 
the casino the opportunity to place bets in that facility for the 
races that are being run at Hollywood Park. 

SENATOR AYALA: The perception up here is that race tracks 
are okay, and racing's on the up-and-up, and now you're merging 
them with casinos and other types of gambling. 

MR. NICHOLAW: Well, it's not exactly a merger. It's 
really another venue of gambling within the same area. And it 
hasn't been — I don't think it has been detrimental at all. I 
think it has been very helpful to growing horse racing because of 



13 

the interest of those that attend the casino to the horse racing 
industry . 

SENATOR AYALA: They're all the same people? 

MR. NICHOLAW: Well — 

SENATOR AYALA: There's no detrimental effect on the race 
track? 

MR. NICHOLAW: I mean, there — I really don't know what 
exactly the figures are at the casino right now, but I would 
think that the impact against Hollywood Park would have been felt 
by this time, and I don't see any evidence of that. 

SENATOR AYALA: You don't have percentage either? 

MR. NICHOLAW: No, because they have expanded their 
revenues during the past three or four years. 

SENATOR AYALA: In Southern Cal., that's the only track 
that has the — ■ 

MR. NICHOLAW: The only one that I'm aware of. I'm sure 
there isn't any that has a casino built on the facility. 

CHAIRMAN LOCKYER: As not a regulator, but, I guess, sort 
of an employer in a way, do you have responsibilities to evaluate 
any number of employees that work for the Board or the — 

MR. NICHOLAW: Yes, we — there is an evaluation that goes 
on by the staff on a constant basis. All the members of the 
Board are informed by the stewards as to all types of activity 
that is against policy on a weekly basis. Every single week, you 
get a, you know, a stack of mail, detailing exactly what 
transpires each day at every racing association in the state. 

CHAIRMAN LOCKYER: What kind of issues come up? 

MR. NICHOLAW: Well, for example, if somebody has been 



14 

rude to a security person, that comes up. If somebody is in an 
area where they aren't supposed to be, that comes up. Any number 
of areas that involve the deportment of everybody that is 
licensed by the Horse Racing Board. 

CHAIRMAN LOCKYER: Now, do you have to then periodically 
evaluate stewards, and so on? Is that part of your — 

MR. NICHOLAW: Yes, staff does that. 

CHAIRMAN LOCKYER: Do those ever come before the Board? 

MR. NICHOLAW: They come for approval each year before the 
Board. 

CHAIRMAN LOCKYER: All right. Other questions? 

Is there anyone present who wishes to add any additional 
comment? There are a couple coming forward here. 

MR. NICHOLAW: Oh, my God. 

MS. PAGE: There's so much noise in the back, I'm not 
sure, is this Mr. Scurf ield? 

CHAIRMAN LOCKYER: No, Mr. Scurf ield is over there. 

MS. PAGE: Okay, so this is Mr. Nicholaw? 

CHAIRMAN LOCKYER: Yes. 

MR. BLONIEN: Thank you, Mr. Chairman and Members. 

Rod Blonien, representing the Thoroughbred Owners of 
California, the Horsemen's Quarterhorse Racing Association, and 
Cal Western Appaloosa Association. 

We would like to lend our very strong support for 
Mr. Nicholaw. He's been on the Board, I believe, for about five 
years. We feel he's done an excellent job and would like to see 
him returned. 

CHAIRMAN LOCKYER: A motion on this matter? 



15 

SENATOR BEVERLY: Move we recommend confirmation. 

CHAIRMAN LOCKYER: Senator Beverly moves confirmation. 

Call the roll. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. 

SENATOR LEWIS: Aye. 

SECRETARY WEBB: Lewis Aye. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Five to zero. 

MR. NICHOLAW: Thank you very much, Mr. Chairman and 
Members of the Committee. 

CHAIRMAN LOCKYER: Now Mr. Scurf ield. Good afternoon. 

MR. SCURFIELD: Good afternoon. 

CHAIRMAN LOCKYER: Did you want to start with any general 
description of the nature of your work or activities on the 
Board? 

MR. SCURFIELD: Maybe only that I've been serving for five 
years now, and I also, as George has, have enjoyed it very much. 

I think we're in challenging times in horse racing, not 
only in California, but internationally and within the United 
States. And so, we've done some things and got some things 
started, and I'd like to see them continued and would like to 
serve again. 



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16 

CHAIRMAN LOCKYER: What's the nature of the Scurf ield 
Company? 

MR. SCURFIELD: Scurf ield Company is a property management 
company that my children run. 

CHAIRMAN LOCKYER: Oh, okay. You're the President, but 
they really do the work? 

MR. SCURFIELD: It's kind of like I'm Chairman of the 
Horse Racing Board. It's titular, and I'm semi-retired. I do go 
in and check the bank account once in a while, 

CHAIRMAN LOCKYER: Are there questions? 

You help me understand, again, the drug testing, illegal 
medication policies. 

Are your responsibilities different in any way when you're 
Chair rather than just a regular member, or is it — 

MR. SCURFIELD: No, actually, you're Chair at the pleasure 
of your other commissioners. So, it's not something that is a 
special appointment, or anything like that. 

CHAIRMAN LOCKYER: Does it take more time to do that? 

MR. SCURFIELD: It only takes more time that you want to 
take, really. 

But you mentioned medication, and I think this is also a 
very interesting time for medication issues because we have two 
real concerns. We have concerns for the people within our 
industry that we think are very, very fine people, and 99 and 
99/ 100s percent of them would not do anything to jeopardize their 
license or this industry. 

But we also then have — we have technology that's coming 
in this testing that's coming so fast that we have a fine line 



17 

now between enhancing, maybe an enhancing medication, versus a 
therapeutic medication that shows up at a later time, and being 
fair to our licensees. 

And we have this development. Mr. Wood has presented our 
Board, and we adopted last year, an Integrity in Racing Program 
that gives a little more latitude to the stewards in really 
evaluating this technology versus fairness to our people. And I 
think it's working very well, and of course, we are the appellate 
body, so it serves us very well, too. Anything that goes to the 
stewards that licensees are not happy about comes to us. 

CHAIRMAN LOCKYER: Other questions from Members? 

If there's anyone present who wishes to comment, now would 
be the appropriate time. 

MS. PAGE: My name is Carolyn Page. I sent some 
correspondence to Nancy Michel. 

CHAIRMAN LOCKYER: We've all had a chance to read it. 

MS. PAGE: Okay. 

In addition to the information that you have received, I'd 
like to make a short statement. 

CHAIRMAN LOCKYER: All right. 

MS. PAGE: I am here to ask you to vote no on the 
confirmation of Ralph Scurf ield. My request is based on the fact 
that under the leadership of Commissioner Scurf ield, the CHRB has 
violated numerous civil rights in regard to the protection of 
women . 

In May of 1995, I was sexually assaulted by a CHRB- 
licensed horse trainer on the premises of Hollywood Park Race 
Track. When I contacted Hollywood Park's security, I was 



18 

referred to a CHRB investigator. 

I was encouraged by him to report the crimes the 
perpetrator had committed against me. He also promised to be 
involved in the CHRB investigation. 

To date, it appears that no one in the CHRB has even 
spoken face-to-face with the perpetrator. 

Throughout this process, I feel as though I have been re- 
assaulted by the CHRB's inactions and the insulting and demeaning 
remarks made to me by their investigators. 

I have heard horror stories from other females who have 
filed complaints with the CHRB. I believe this routine type of 
behavior should stop. 

I ask that you give someone who is better qualified the 
opportunity to turn this agency around. 

CHAIRMAN LOCKYER: Mr. Scurf ield, are you familiar with 
this? 

MR. SCURFIELD: Yes, I am. 

CHAIRMAN LOCKYER: Maybe you'll share with us whatever 
your — 

MR. SCURFIELD: Yes, you know, we serve in an overseeing 
capacity, and regulations, and those type of things. 

But I became aware of this not too long ago, through your 
letter, Ms. Page. And, of course, immediately went to the staff 
and said, "What is the situation?" 

And we would have been — all of the Commissioners, 
because I think that all of them heard from her, and we wanted to 
know, because this is our, you know, we're the ultimate 
responsibility. 



19 

And we were informed by the staff that this had been 
investigated by the various law enforcement agencies in the area, 
and that our people were monitoring that. And although we 
enforce regulations within the horse racing industry, that the 
outside law enforcement agencies, when they are concerned, we 
normally abide by whatever their outcomes are. 

If their outcomes are one that a charge is filed, or 
something like that, then that licensee comes before us. But if 
there's no charge filed, and it's not a regulation matter, it's a 
penal matter, then we are not directly involved. 

And I think that was conveyed. 

CHAIRMAN LOCKYER: As I understand your point, the police 
department in Inglewood or the District Attorney's Office — 

MR. SCURFIELD: I think both of those agencies have had 
some involvement in it, and worked with our people. 

CHAIRMAN LOCKYER; Ms. Page, are you aware of them having 
looked into the matter? 

MS. PAGE: Very limited, sir. I'll tell you about that 
when I have an opportunity to respond to the remarks he made. 

CHAIRMAN LOCKYER: Please, now is appropriate, 

MS. PAGE: First of all, not one Commissioner, not one, 
has contacted me. Nobody from the Commissioner's office has 
contacted me in response to my — to my correspondence to that 
office. Not one. 

I called on Mr. Nicholaw, and he called me back and said 
that Mr. Scurf ield would be corresponding with me. That's the 
last I've heard. 

CHAIRMAN LOCKYER: Didn't Mr. Wood correspond with you? 



20 

MS. PAGE: No, not a word from Mr. Wood. 

CHAIRMAN LOCKYER: Is 4822 Shelby Place still the correct 
address? 

MS. PAGE: Right. 

CHAIRMAN LOCKYER: We have — 

MS. PAGE: Mr. Wood has never sent me a letter. Or, if he 
sent me a letter, I do not remember it. 

CHAIRMAN LOCKYER: Okay. We have a copy, a Xerox, of 
correspondence from June 5th from Mr. Wood. 

MS. PAGE: June 5th? 

CHAIRMAN LOCKYER: Yes. 

MS. PAGE: Of last year? 

CHAIRMAN LOCKYER: No, this year. 

MS. PAGE: Well, I don't have it. 

CHAIRMAN LOCKYER: -Well, that's why you haven't seen it, I 
can tell. 

Maybe I should give you a copy of your mail. 

MS. PAGE: That would be wonderful. 

CHAIRMAN LOCKYER: But it basically says what you've 
heard, that they rely on the District Attorney or Inglewood 
Police Department for purposes of penal — 

MS. PAGE: And you want to hear the funny part about this? 

The D.A. and the Inglewood P.D. also rely on the 
California Horse Racing Board, according to those agencies. 

What I see is a conflict between these agencies who say 
one person's responsible; the other one says it. So, it's a 
bouncing ball. 

CHAIRMAN LOCKYER: So you think they're — 



21 

MS. PAGE: Absolutely. 

CHAIRMAN LOCKYER: — just passing — 

MS. PAGE: Inglewood P.D. did not even want to take a 
police report. I had to go to the District Attorney's Office to 
get a police report put on file. 

CHAIRMAN LOCKYER: All right, thank you for your comment. 

MS. PAGE: One other thing, sir. 

Now, while he — while the Commissioner is saying that he 
takes no actions until an investigation has been done by the 
police authorities, that was not the agreement with the CHRB 
investigator. I would never have reported the crimes to the 
police had I not had the encouragement and the promise of support 
if I reported it to the police. 

CHAIRMAN LOCKYER: Well, I would think that the police 
report for a crime like this would be the appropriate thing. 

MS. PAGE: Right, but I had no intentions of doing that 
because I feared for my life. 

Not only did — when I spoke to the investigator, I 
provided him with written documentation to report to him other 
incidents of violence that the perpetrator had committed against 
other people at the race track, and the horses, and nothing was 
done about that, either. 

So, it wasn't just me. It wasn't just — just a report 
that had to go to the police. It was a report that went to your 
agency, and no one ever called me back, and was insulted when I 
called them. 

CHAIRMAN LOCKYER: Let me ask, I know you feel, as a 
general manager, that a specific incident is not exactly within 



22 

your purview unless it comes through the staff and the police 
department. 

Is there any policy that the Board has developed or is 
implementing that relates to matters of police policing the 
facilities and premises, safety of patrons, and sexual 
harassment-type issues? 

Those are sort of three different things. 

MR. SCURFIELD: Yes. Let me do the best I can. 

We, as Commissioners, are aware of the regulations of the 
Horse Racing Board, and we're aware of when our investigators are 
involved in those, and maybe they're — normally, they'd come, 
then, before the stewards, and their license is in jeopardy, or a 
fine, or something like that. 

There also — we oversee anybody that's applying for a 
license that has been convicted of a crime of moral turpitude, 
which I think would certainly be involved here, because, as you 
can see, that's a prerequisite to our involvement in the 
licensing process. 

CHAIRMAN LOCKYER: When there's been a conviction? 

MR. SCURFIELD: When there has been a conviction. 

Also, I think if we're just talking about harassment, or a 
gender situation, then our staff would look into that and report 
back to the Commission. And normally when these things come up, 
they respond to all the Commissioners, not just the one that had 
the question. 

So, you know, I think we're handling it as best we can. 
And if there's way to improve, we'll do it. 

CHAIRMAN LOCKYER: One of the things — I don't know if 



23 

you have considered this or, perhaps, adopted — that we found in 
the legislative setting that it's necessary to make sure that we 
annually train ourselves and our employees to be more sensitive 
about the changing attitudes in law with respect to sexual 
harassment. 

Now, this is way past that in terms of the nature of the 
complaint. 

But it just might be, in terms of the general employment 
atmosphere, worth a discussion to see if there's been things like 
that done to contemporize people and make sure that we do the 
best we can. 

MR. SCURFIELD: Mr. Wood is here today, and he's, of 
course, heard your words. And I can assure you that he and I 
will have the same conversation. 

CHAIRMAN LOCKYER: All right. 

Thank you very much. 

Any other questions from Members? 

Yes, Mr. Blonien. 

MR. BLONIEN: Mr. Chairman and Members, Rod Blonien in 
support of Mr. Scurfield's appointment. 

Mr. Ed Friendly, the Chairman of the Thoroughbred Owners 
of California, wanted me to read part of a letter that he sent 
Senator Lockyer, and I'll just read two lines: "Over the past 
decade, I've participated in at least 100 CHRB and/or committee 
meetings. Ralph Scurf ield, in my opinion, is by far the most 
effective CHRB Chairman the industry has had." 

CHAIRMAN LOCKYER: I think that must be quite a 
compliment. 



24 



MR. SCURFIELD: I appreciate it. 

MR. BLONIEN: I think he's too generous in his 
compliments. 

CHAIRMAN LOCKYER: Well, you have some other friends, 
former Chairman. 

What ' s the pleasure of the Committee? 

SENATOR BEVERLY: Move we recommend confirmation. 

CHAIRMAN LOCKYER: All right, call the roll, please. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. 

SENATOR LEWIS: Aye. 

SECRETARY WEBB: Lewis Aye. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Five to zero. 

MR. SCURFIELD: Thank you very much. 

[Thereupon this portion of the 
Senate Rules Committee hearing 
was terminated at approximately 
12:30 P.M.] 

— ooOoo — 



25 



CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of the 
State of California, do hereby certify: 

That I am a disinterested person herein; that 
the foregoing transcript of the Senate Rules Committee hearing 
was reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 

\ r4i IN WITNESS WHEREOF, I have hereunto set my hand 

this // day of June, 1995. 




Shorthand Report 



304-R 

Additional copies of this publication may be purchased for $3.00 per copy 
(includes shipping and handling) plus current California sales tax. 

Senate Publications 

1020 N Street, Room B-53 

Sacramento, C A 958 1 4 

(916)327-2155 

Make checks payable to SENATE RULES COMMITTEE. 
Please include Stock Number 304-R when ordering. 






JUL 1 7 1996 

SANFR' O 

PUBLIC LlbHARY 



^HEARING 



SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 



/ 



{/■r-C 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

MONDAY, JUNE 17, 1996 
1:58 P.M. 



305-R 



Reported by 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 



MONDAY, JUNE 17, 1996 
1:58 P.M. 



Evelyn J. Mizak 
Shorthand Reporter 



11 



APPEARANCES 

MEMBERS PRESENT 

SENATOR WILLIAM LOCKYER, Chair 

SENATOR ROBERT BEVERLY, Vice Chair 

SENATOR RUBEN AYALA 

SENATOR JOHN LEWIS 

SENATOR NICHOLAS PETRI S 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 

PAT WEBB, Committee Secretary 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

K. WILLIAM CURTIS, Chief Counsel 
Personnel Administration Department 

ELAINE E. LOKSHIN, Member 
State Board of Education 

ELIN D. MILLER, Director of Conservation 

SENATOR JIM COSTA 

ERIK VINK 

American Farmland Trust 

GLENDA HUMISTON, Vice President 

California Association of Resource Conservation Districts 

DENISE DELMATIER 

The Gualco Group for Norcal Waste Systems, Inc. 

ROBERT MEACHER, Chairman 

Board of Supervisors, Plumas County 

Regional Council of Rural Counties 

LINDA BARR 

Sierra Club of California 

SEBASTIANO STERPA, Member 

Board of Directors 

California Housing Finance Agency 



Ill 

INDEX 

Page 
Proceedings 1 

Governor ' s Appointees : 

K. WILLIAM CXJRTIS, Chief Counsel 

Department of Personnel Administration 1 

Background and Experience 1 

Questions by CHAIRMAN LOCKYER re: 

Resolution to Current Negotiations 

with Bargaining Units 3 

Rules regarding MOUs 3 

Memorandum from MR. WADDELL 4 

Efforts to Try to Get Multi-year 

Agreements with Bargaining Units 5 

Career Executive Positions 6 

Principle Responsibilities 7 

Personal Involvement with 

Collective Bargaining 8 

Motion to Confirm 8 

Committee Action 9 

ELAINE E. LOKSHIN, Member 

State Board of Education 9 

Questions by CHAIRMAN LOCKYER re: 

Expiration of Term 9 

Knowledge Gained from This Experience 9 

Most Controversial Issue 10 

Motion to Confirm 10 

Committee Action 11 

ELIN D. MILLER, Director 

Department of Conservation 11 

Introduction by SENATOR JIM COSTA 12 

Background and Experience 13 



IV 



Questions Raised in Letter to Committee 

from SENATOR BYRON SHER 16 

History of SMARA 17 

Mines Out of Compliance with SMARA 18 

Reclamation Plans for Mines 19 

Questions by CHAIRMAN LOCKYER re: 

Number of Mines Operating Illegally 

or Abandoned 20 

Number of Active Wines that Have Filed 

Reports with the Department 21 

Enforcement Actions Available 22 

Bond Pooling to Assist in Financial 

Assurance Requirement of SMARA 23 

Number of Mines Taxpayers Will Be 

Responsible for Cleaning Up 24 

State's Potential Financial Exposure 25 

Questions by SENATOR LEWIS re: 

Options Available to Department When 

Mines Refuse to Comply with SMARA 25 

Questions by SENATOR PETRIS re: 

Bond or Security Requirement for 

New Mines 26 

From of Financial Assurance 26 

Types of Mines 27 

Open Quarries Versus Mines 27 

Reasons for Lack of Compliance 

Enforcement by Department 28 

Questions by CHAIRMAN LOCKYER re: 

RFP on Study of Recycling Programs 29 

Knowledge that Issue of Study Had Been 

Raised and Rejected during Discussion 

of SB 1158 31 

Number of Groups and Individuals 

Contracted in RFP 32 



Collaboration of Consultants on RFP 34 

Unreasonable Expectation of Unbiased 

Commentary from Reason Foundation Consultant . . 35 

Questions by SENATOR PETRIS re: 

Open Hostility of RFP Consultant to 

Any Governmental Involvement in 

Recycling Programs 36 

Witnesses in Support; 

ERIK VINK 

American Farmland Trust 39 

GLENDA HUMISTON, vice President 

California Association of Resource Conservation 

Districts 40 

DENISE DELMATIER 

Gualco Group on behalf of Norcal Waste Systems 41 

Questions by SENATOR AYALA re: 

Where Did Money for RFP Study Come From 44 

Source of Study Money 45 

Questions by CHAIRMAN LOCKYER re: 

Number of Other Departmental Studies 

Currently 47 

Witness in Support: 

ROBERT MEACHER, Chairman 

Board of Supervisors, Plumas County 

Regional Council of Rural Counties 48 

Witness with Concerns: 

LINDA BARR 

Sierra Club 50 

Questions by CHAIRMAN LOCKYER re: 

Any Particular Problems Associated with 
Preserving Agricultural Land 51 

Questions by SENATOR BEVERLY re: 

Due Date on Recycling Study 52 



VI 



Questions by SENATOR PETRIS re: 

Cost to Taxpayers if the 14 6 Mines 
Which Have Ceased Operation become 
Abandoned 53 

Statements by CHAIRMAN LOCKYER on Putting 

Matter Over to Future Date 55 

SEBASTIANO STERPA, Member 

Board of Directors 

California Housing Finance Agency 56 

Background and Experience 56 

Questions by CHAIRMAN LOCKYER re: 

Toughest Problems 57 

View on Colidating Housing Agencies and 

Programs in State 57 

Questions by SENATOR PETRIS re: 

Less Duplication of Effort if Different 

State Housing Agencies were Consolidated 58 

Proportion of Money Allocated to Low and 

Very Low Income Families 59 

Increase in Number of Multi-family 

Units 59 

Inventory of Need in State 60 

Percentages that Go to Multiple Housing 

and Single Family Housing 61 

Criticism of Agency's Collection and 

Reporting of Data to Legislative Analyst 61 

Most Funding Housing Located in Areas 

of Moderate Construction Costs 64 

Motion to Confirm 65 

Committee Action 66 

Certificate of Reporter 67 



P-R-0-C-E-E-D-I-N-G-S 
— ooOoo — 

CHAIRMAN LOCKYER: Our first appointee is Mr. Curtis. 

MR. CURTIS: Good afternoon, Mr. Chairman. 

My name is Bill Curtis. If I may, I'd like to give 
the Committee a short statement. 

CHAIRMAN LOCKYER: Sure. 

MR. CURTIS: Mr. Chairman, Senators, I'm pleased and 
honored to have been appointed by Governor Wilson as Chief 
Counsel of the Department of Personnel Administration, DPA. 

In this position, I've been able to draw on some 18 
years of experience in labor relations, beginning as a 
legislative intern for a statewide police organization, through 
some ten years at the bargaining table, negotiating collective 
bargaining agreements in the public sector arena, and dealing 
with the challenges of managing attorneys and support staff 
first as a law partner in a private practice, then both as 
Deputy Chief Counsel and Chief Counsel for DPA. 

After completing my legal education, graduating from 
McGeorge School of Law with a Juris Doctorate degree, I was 
admitted to the California State Bar in 1980. 

I came to state service in 1988 by way of appointment 
as legal advisor to the Public Employment Relations Board, PERB, 
to the Chairperson. This position allowed me to transition from 
eight years of representation of unions and individual employees 
to a neutral role. My experience at PERB also provided the 
opportunity to broaden my understanding of the state labor 
relations acts, such as the Educational Employment Relations 



Act/ EERA, the Higher Educational Employment Relations Act, 
HEERA, and the Ralph C. Dills Act, formerly known as SEERA. 

In 1991, I was appointed as senior labor relations 
officer to DPA to negotiate collective bargaining agreements for 
some of the state bargaining units. Subsequently, in 1992, I 
accepted the position of Deputy Chief Counsel for DPA's Legal 
Division, where I remained until my predecessor left to assume 
another position. 

During my tenure as Deputy Chief, I served as acting 
Chief Counsel when the Chief Counsel was out of the office for 
extended periods due to illness. 

My litigation at DPA has been devoted mostly to cases 
arising out of the Dills Act collective bargaining problems in 
maintaining the Memoranda of Understanding, such as 
arbitrations, defense of ancillary actions arising from alleged 
unfair practices. 

Much of my experience in private practice was involved 
in representing public safety unions and their members in 
personnel actions before various local civil service 
commissions, the State Personnel Board, and in labor relation 
matters before arbitrators, county boards of supervisors, the 
PERB, and state courts, and disability retirement appeals 
throughout at the state. 

I believe these experiences have qualified me for the 
position of Chief Counsel at DPA. 

Additionally, the number of years as an advocate for 
organized labor has given me valuable insight to facilitate 
reaching mutually acceptable settlements of disputes that 



naturally flow from the- give and take between the employer and 
the employees. 

Finally, I'd like to thank the staff members of the 
Committee and individual Senators for their assistance in 
preparing for this hearing. 

I'd be happy to answer any questions that you may have. 

CHAIRM7\N LOCKYER: Are there questions that Members 
want to start with? 

I'm happy to begin/ which would be to inquire about 
current negotiations with bargaining units. When might we 
expect to the see some resolution of these matters? 

MR. CURTIS: I don't know. I think it's going to 
depend a lot on the budget and what's in there for trading. 

But when the parties reach a mutual agreement, and as 
you know, each individual unit has their own particular needs 
and desires, I think that we may be able to have collective 
bargaining agreements that are satisfactory to both sides. I 
would anticipate some time after the budget's passed, which has 
traditionally been what we've had. 

CHAIRM7VN LOCKYER: What are the rules? You have an MOU 
that's acted on by the Legislature, or approved or disapproved 
at some point. 

MR. CURTIS: Pardon. 

CHAIRMAN LOCKYER: What's the time frame for us to act 
on an MOU? 

MR. CURTIS: I am not sure what the time frame to act 
on the MOU is after it's forwarded to the Legislature, but I 
believe it's 30 days. 



CHAIRMAN LOCKYER: If we're not in session, does it 
just hold? 

MR. CURTIS: Yes. There cannot be an MOU without 
MOU-enabling legislation. 

CHAIRMAN LOCKYER: Well, I notice earlier this year, 
there was a communication from the Department to the various 
individual departments saying that somehow the Legislature's 
failure to provide • funds for salary and benefit increases was 
cause of the delay in reaching agreement on contracts. 

MR. CURTIS: I'm not aware of that memorandum or that 
communication. There are many causes for delays. 

CHAIRMAN LOCKYER: It might start with the fact the 
Governor didn't put any in the budget. It's pretty hard for us 
to until the budget is enacted. 

I'll show you the communication, because frankly, it's 
pretty offensive. If you're the fall guy, you're about to fall, 
if you had anything to do with it. I'll show it to you first. 
You can tell me where it came from. No, it's from Waddell. 

MR. CURTIS: My predecessor. 

CHAIRMAN LOCKYER: Yes. He copied you, which is how 
you get in the loop, apparently. This was your predecessor and 
it's not current. 

MR. CURTIS: It's 1993. 

CHAIRMT^ LOCKYER: Your name is mentioned as one of the 
people he copied. 

So, you ducked that bullet. 

[Laughter. ] 

MR. CURTIS: Thank you. 



CHAIRMAN LOCKYER: But I've got some more here. 

Is there anything else you could tell us just about the 
general process of trying to resolve employee bargaining? 

MR. CURTIS: With the bargaining, not really. 

DPA has a head of labor relations, the chief 
negotiator, and basically he runs that. 

I'm involved as counsel normally would be, to review 
any proposals that may have some legal significance. 

But generally, bargaining normally, and particularly in 
good years, just follows the give and take of the bargaining 
table. And it's been my experience that when there is something 
to give, that we get the MOUs. 

I've been on the side a lot longer asking for the 
giving rather than being able to be on the side that delivered 
it. 

When I was bargaining in the last go-around, we did 
get extended contracts, the multi-year contracts. I think it 
was beneficial to everybody. Certainly, my experience in the 
numbers of arbitrations and the types of arbitrations, the kinds 
of disputes that arose out of that set of MOUs has indicated to 
me that it's a pretty good set of contracts. 

CHAIRMAN LOCKYER: Is there still an effort to try to 
get a multi-year agreement? Is that still alive? 

MR. CURTIS: I'm not sure what's on the table at this 
time, whether it's single-year or multi-year. 

I'm sure of the 21 units, there are probably some 
unions that have multi-year proposals, and at this point in 
time, I'm not sure if the state has gone to such a proposal. 



But it's well within contemplation of the parties in any given 
year to do that. 

CHAIRMAN LOCKYER: Are there other questions from 
Members? 

Let's talk about career execs. I guess there have been 
sort of two things happening. An effort to expand the number of 
positions in the career executive pool, and to shift decision 
making about those matters from the Personnel Board to the 
Department? 

MR. CURTIS: The career executive appointment, or CEA 
process, which was begun in approximately 1963, it was put into 
law, the predecessor of Government Code 19889, laid that out. 

I don't know, nothing has changed in those years. 
There was an earlier case that talked about the vesting of an 
individual's rights, and since that time, there have been no 
appellate challenges or otherwise to that process. 

I am aware, just vaguely, that the Little Hoover 
Commission recommended, I think, putting all managers into the 
CEA process. DPA, as far as I know, reviewed that process and 
realized that all those managers did not rise to the level of 
the requirements for CEA, the high level policy and governmental 
decisions and advice decisions. 

So, DPA has gone on with its review, as it's required 
to do by Government Code Section 19889, in the normal manner. 
Those recommendations are then approved, or reviewed, monitored, 
by the State Personnel Board. And I understand in the process, 
since this Little Hoover Commission's report, there have been 
some three or four hundred potential candidates identified as 



having — should have been CEA because of the types of jobs they 
do. 

CHAIRM7VN LOCKYER: How many? 

MR. CURTIS: Three to four hundred, and at this point 
in time/ latest report that I'm aware of, 170-some have gone to 
the State Personnel Board in the normal course, and I'm not sure 
how the Board's acted on those. 

CHAIRMAN LOCKYER: Do you have any personal role in 
those decisions? 

MR. CURTIS: No, that's the Classification and 
Compensation Division reviews those, as they're required to do 
from time to time, and make sure that the positions match the 
job they're doing. 

CHAIRMAN LOCKYER: What would you say are the principle 
responsibilities then, that account for the bulk of your time 
being used at work? 

MR. CURTIS: The bulk of my time, I've learned this the 
sad way, through experience, is dealing with the personnel 
problems of managing attorneys and support staff. 

But other than that, I do advise the Director and the 
Governor through the Director, and members of the executive 
staff of DPA. And also, I offer advice either through my staff 
or through my personal contact with the agencies and departments 
throughout the state. The Legislature has called me on advice, 
for example, regarding the compensation for some staff members 
in the past. We naturally come to DPA, because they make those 
kinds of decisions. 

That's the bulk of my responsibility. 



8 

CHAIRMAN LOCKYER: ■ To what extent are you personally 
involved in collective bargaining, then? Is that minimal? 

MR. CURTIS: In my role as Chief Counsel and as Deputy 
Chief Counsel prior to that, I had very little role in 
collective bargaining. 

Occasionally, I'm asked to go the table to explain a 
concept, or address some concerns anyone may have on 
constitutionality of issues, and that sort of thing, and try to 
assuage any fears they have, that we're looking at it from 
basically at the same point of view that they are. 

And we've been pretty successful at that. If you're 
aware, the Highway Patrol has adopted some disciplinary matters 
that seem to be very promising, and the proof will be in the 
pudding, but so far it looks pretty good. 

CHAIRMAN LOCKYER: Other questions from Members. 

Is there anyone present who wishes to make any 
comment? 

All right, what's the pleasure of the Committee? 

SENATOR BEVERLY: Move we recommend confirmation. 

CHAIRMAN LOCKYER: We have that motion, call the roll. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. 

SENATOR LEWIS: Aye. 

SECRETARY WEBB: Lewis Aye. Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 

SENATOR BEVERLY: Aye. 



SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Five to zero. 

CHAIRMAN LOCKYER: Good luck, sir. 

MR. CURTIS: Thank you very much. 

CHAIRMAN LOCKYER: Okay, let's see, Elaine Lokshin, I 
guess, is our next one. Good afternoon. 

MS. LOKSHIN: Good afternoon, Senators. 

CHAIRMAN LOCKYER: How are you? 

MS. LOKSHIN: Very well, thank you. 

CHAIRMAN LOCKYER: You're still a high school student? 

MS. LOKSHIN: No, not since Thursday. 

CHAIRMAN LOCKYER: How long does your term continue 
until? 

MS. LOKSHIN: Only one more month. I finish at the end 
of July. 

CHAIRMAN LOCKYER: What did you learn doing this? 

MS. LOKSHIN: I learned a lot. I think my speaking 
skills have improved in the past few months. 

I've come to the conclusion for myself that I prefer to 
go into private business before I ever return to work for the 
government or any type of public office. 

[Laughter.] 

MS. LOKSHIN: I've had a wonderful time this year. 

CHAIRMAN LOCKYER: Was it continuing as a junior 
purchase clerk that you had in mind? 

MS. LOKSHIN: No. 

CHAIRMAN LOCKYER: What was the most controversial 



10 

issue before the Board during the time that you were there? 

MS. LOKSHIN: I think the Reading Advisory took up — 
had a lot of controversy tied to it, and a lot of meetings, and 
hearings, and so forth. 

But I believe it was in May that the Board approved the 
Reading Advisory, which I think will really help improve the 
reading in California schools today. And has more of a direct 
focus on what the intentions of the Board is. 

CHAIRMAN LOCKYER: Are there questions at all from 
Members? 

Any member of the Board — if you don't want to tell 
me publicly, you can tell me privately, anyone we shouldn't have 
confirmed? 

MS. LOKSHIN: No, they've all been very kind to me, and 
they've been wonderful people. 

CHAIRMAN LOCKYER: I wish I could take about half of 
them back. 

Anyhow, all right. Senator Ayala. 

SENATOR AYALA: She's from my neck of the woods, so 
I'll move confirmation. 

MS. LOKSHIN: Thank you. 

CHAIRMAN LOCKYER: The woods have been heard from. 

We have a motion, call the roll. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. 

SENATOR LEWIS: Aye. 

SECRETARY WEBB: Lewis Aye. Senator Petris. 



11 



SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Five to zero. 

CHAIRMAN LOCKYER: I should have had asked you what 
you're going to do next year? 

MS. LOKSHIN: I'm going to Rice University. I plan to 
major in economics. 

CHAIRMAN LOCKYER: Good luck. 

MS. LOKSHIN: Thank you very much. 

CHAIRMAN LOCKYER: Ms. Miller is next. Good afternoon, 

MS. MILLER: Good afternoon. 

I've just been informed that Senator Costa is on his 
way. He was going to introduce me, so if it's all right with 
you, Mr. Chairman, when he gets here, I'll — 

CHAIRMAN LOCKYER: We'll interrupt you, sure. 

MS. MILLER: Thank you. 

I'm truly honored to have the opportunity to be here 
today as the Governor's appointee to the Department of 
Conservation. 

I also want to take this opportunity to thank Nancy 
Michel for her assistance in guiding me through this possess. 
It's the first time going through the appointment process. 

I bring to this position experience in public policy 
development, regulatory and legislative oversight and affairs. 

CHAIRMAN LOCKYER: Do you want to be interrupted right 



12 

now? 

MS. MILLER: Great, wonderful. 

CHAIRMAN LOCKYER: Senator Costa. 

SENATOR COSTA: Thank you very much, Mr. Chairman, 
Members of the Rules Committee. I'll be very brief. 

I don't want to cause the interruption of the comments 
that Elin was making, but I just wanted to share with Members of 
the Committee that I have worked with this individual for a 
number of years in many of her past professions, different hats 
that she's worn, both in the Department of Pesticide Regulation, 
where we dealt with the strategic plan that has allowed the 
Department to bring in outside constituencies to serve with the 
Department's operations and to provide input. Also, to work 
with the regulatory focus with the local ag. commissioners' 
offices. 

I think the experience in the past, both when she has 
worked in other segments within the state government, as well as 
in the private sector, that she has been able to work with 
Members on both sides of the aisle. 

I think she's proactive in her approach toward problem 
solving, and I think she wants to try to make — she comes to 
government with the notion that we ought to make it work and 
make it user-friendly. 

And we've not always agreed on every single issue. 

CHAIRMAN LOCKYER: Do you remember one you disagreed 
about? 

SENATOR COSTA: Yes. 

But even on those issues of disagreement, we have been 



13 

able agree to disagree and continue and to work, so I think 
that's an important part. 

CHAIRMAN LOCKYER: Thank you. Senator. 

SENATOR COSTA: Thank you. 

CHAIRMAN LOCKYER: We had just begun. If you want to 
start again, that's okay. 

MS. MILLER: I guess perhaps more important than some 
of the experiences that I bring to this position, that I bring 
an intense desire do make government work better for the people 
of California. 

In the three years since I joined state service, I 
found the public sector both rewarding as well as challenging. 
While in the private sector, I must admit to greatly 
underestimating the talent and commitment of those individuals 
who work in state service. 

I've learned that government certainly has its 
challenges, and that how we can really deal and meet those 
challenges is with our collective and continuous commitment to 
improvement . 

In 1993, I joined as Chief Deputy Director of the 
Department of Pesticide Regulation. There I administered the 
day-to-day operations of a $45 million budget, and approximately 
400 employees. To that job, I took 16 years of experience in 
the private sector — I did it backwards, private sector before 
coming here — 16 years of experience there, where I worked for 
large corporations as well as small family- run businesses. I 
also had the opportunity to manage a trade association. 

Aside from the hands-on business and management 



14 

knowledge I gained through those experiences, I also learned to 
work with a very diverse group of people. This will serve me 
well in handling the concerns of the extreme and varied 
constituencies we interact with at the Department of 
Conservation. 

I contribute much of my concensus building expertise to 
the periods I've had an opportunity to serve on various boards 
and commissions. I was appointed to the U.S. Department of 
Agriculture negotiating team on the 1995 farm bill, in looking 
at the conservation provisions of the farm bill. I'm pleased to 
say that a lot of that which came out of our dialogue group 
ended up making it into the 1996 farm bill. 

I also recently co-chaired two committees, one 
committee with the U.S. Environmental Protection Agency to look 
at international harmonization of pesticide regulation policies, 
and also another committee I co-chaired with the County 
Agricultural Commissioners to look at redirecting our 
enforcement activities to areas of more public health concern, 
as well as more areas of environmental concerns. 

For the past seven months, I've served as the Director 
of the Department of Conservation. The Department oversees a 
variety of programs that deal with California's environment, 
economy, and public safety. 

The Division of Mines and Geology is within the 
Department of Conservation, and in that area we deal with 
geological mapping and seismic hazards and our earthquake 
programs . 

The Department's also responsible for the Surface 



15 

Mining and Reclamation Act, known as SMARA. The law is directly 
implemented by local lead agencies. Those are either counties 
or cities. But in 1990, there were extensive changes to the law 
that basically had the serve as a backstop for enforcement for 
those programs, as well as requiring reporting, which I'll be 
going into later. 

We also have the Division of Recycling, which is 
responsible for the Beverage Container Recycling and Litter 
Reduction Act, which is also a very extensive program with many 
varied constituents. 

Our Division of Oil, Gas and Geothermal Resources is 
responsible for regulating safe drilling as well as abandonment 
of oil, gas, and geothermal wells in the state.' 

And finally, we implement California's major 
agricultural land conservation. These include: the Williamson 
Act, which was passed back in '65, which provides a tax 
differential to keep land and open space in agricultural 
production; the Ag. Land Stewardship Program that Senator Costa 
authored this last year that provides long-term easements for 
farm land protection, as well as for the farm land mapping and 
monitoring program. 

I accepted this appointment because I feel that I have 
in the past dealt with very complex and diverse issues. TVnd as 
I said previously, I have a strong commitment to making 
government work better. 

I believe a person should feel passion about the issues 
they represent, and I do so about conservation, and I can gladly 
say that I really do like my job. 



16 

I've been blessed with a variety of experiences in my 
career. With this has come challenging and controversial 
issues. I deal with these issues in a way that I only found 
that works best, that's direct, honest and up-front 
communication with all entities involved, including local 
government, the environmental community, industry, as well as 
the Legislature. 

In closing, I want to confirm my deep commitment to 
implementing the Department's programs effectively and 
efficiently, and working with you here in the Legislature to do 
so. I look forward to our mutual success. 

I realize that Senator Sher offered some questions on 
Friday, I believe. And I would be happy to answer those 
questions or any others. In particular, he had some issues on 
the recycling program, and also on our Surface Mining and 
Reclamation Act, which in part I do agree with some of the 
things Senator Sher raised with SMARA, and I'd be happy to 
elaborate on how I'd like to deal with those issues. 

CHAIRMAN LOCKYER: Why don't you start with surface 
mining? 

MS. MILLER: Do you want me — 

CHAIRMAN LOCKYER: Well, I can tell you what he asked, 
if you want. 

MS. MILLER: I can go through. 

I think one of the points that the Senator raised in 
his background documents, and I think it would help if maybe I 
put into context the law, and what was in place at different 
times in the law. 



17 

Several issues were raised by the comments, and I want 
to address those various issues. 

The original Surface Mining and Reclamation Act was 
passed back in '76, but a very dramatic change was made in the 
law that was effective January 1, 1991, and for the first time 
there was an aggressive approach at dealing with approved 
reclamation plans, for the first time financial assurances had 
to be in place.. Also, that timeframe established that miners 
had to report to us and keep reports coming in as to the status 
of the mines, so the Department of Conservation was responsible 
for that. And we would also be assisting leads agencies in 
implementation of the act. 

At the time of the passage of these changes, and it was 
AB 3551 that at the time Assemblyman Sher put into place, the 
Department moved forward on an enforcement priority, and I think 
it made sense at the time. The first priority was to get mines 
reporting. The second priority was to be able to deal with 
making sure reclamation plans were drawn up. And then the third 
priority was financial assurances. 

You have to have a reclamation plan in place before you 
can then estimate what the financial assurance needs to be. And 
so, that was the order of priority that they looked at. 

The information that had been provided to the Senate 
Natural Resources Committee, in fact, it was request, I believe, 
that came in about the 24th or 25th of May this year, and we 
sent a letter on the 28th of May. In that request, asked us to 
list the mines without financial assurances, as well as the 
mines without interim management plans. 



18 

SO/ the number of 600 mines out of compliance came from 
those lists. It may have been communication, lack of 
communication, between the Senate staff and our staff, but just 
by asking for a list of which mines that don't have financial 
assurances doesn't mean those mines are not in compliance. 

Under the law, financial assurance is required when a 
miner starts actually operating the mine. So, they may be in 
the process of getting their reclamation plan in place, but 
haven't really started excavation, and it's not required until 
you actually start excavation. 

So, for example, on that list of 600, Senator Lockyer, 
within your district. Mission Valley Rock and Apperson Ridge are 
two mines that fall into that category. They haven't actually 
started excavation, so they're not out of compliance. It's 
true, they don't have a financial assurance, but they actually 
are in compliance with the act. 

Also on that list, we have two different lists that 
were asked for, and we provided those lists. There's actually 
about 71 duplicates. So, just for background, that's why I 
wanted to deal with that for 600 out of compliance. 

However, we do have quite a few mines out of 
compliance, and I wanted to make sure that we're all on the same 
page. 

CHAIRMAN LOCKYER: How many is it that are excusably 
out of compliance because they're not excavating? 

MS. MILLER: What we need to do for that, we wanted to 
look at some of those mines just to check, and so we hadn't had 
a chance to go through and check all of those. 



19 

What happens is, it's the lead agency, it's either the 
local county or city, that's responsible for keeping track of 
has the excavation started, et cetera. 

That gets reported to us on an annual basis, so it's 
also a matter of timing that the reports come in. So, in order 
to accurately say, should we be going after, for example, these 
mines, we would then have to go back specifically to the lead 
agency and find out what the status is of that mine in 
particular. 

In fact, that's one thing I'll go into. I have asked 
our staff, particularly with those lists, to bring to me their 
recommendations on enforcement for that. 

But, just so we know where we are in compliance, since 
the AB 3551 went into effect, there's been a 54 percent increase 
in the amount of mines reporting. That's still not as high as 
I'd like it to be, but at least there has been an increase. 

CHAIRMAN LOCKYER: You mean it was zero before? 

MS. MILLER: Reporting had not been required, right, 
for the Department . 

CHAIRMAN LOCKYER: So, 54 percent doesn't mean 
anything if you started with nothing. If they had no obligation 
to report — 

MS. MILLER: They had no obligation to report, yes, and 
so that's what I said. We're not — I just wanted to show that 
some things have occurred. 

On reclamation plans, it was at 61 percent, because 
reclamation plans have been required for a while. When this 
went into effect in 1991, there was 61 percent in compliance. 



20 

We're at 82.5 percent in compliance in 1996. 

Financial assurances, which the first time they were 
required was starting in '93, was the first year that we have, 
18 percent were in compliance that first year, and we're up to 
69 percent, but still not good enough as far as I'm concerned. 

But I just -- because the numbers were different with 
the 600, I just wanted to show you where we were with the 
different categories of compliance. 

CHAIRMAN LOCKYER: ' What do you think the right number 
is that are operating illegally or abandoned? 

MS. MILLER: As far as the total number, well, under 
SMARA itself is a different number than if you look at abandoned 
mines in the state, and the estimate that our State- Geologist 
has made, there's as many at 40,000 mines. But anything prior 
to 1976 is not under the jurisdiction of SMARA, but there are 
many abandoned mines out there, and it's how do we deal with 
those abandoned mines. 

CHAIRMAN LOCKYER: Mines that were active in '76? 

MS. MILLER: Anything that was in '76 active, came 
under the jurisdiction of SMARA. 

CHAIRMAN LOCKYER: That's the 1400, basically? 

MS. MILLER: There's 1400 mines active in the state 
today, but 40,000 that I mentioned earlier, when we're looking 
at the total amount of abandoned mines potentially in the state, 
historically. 

CHAIRMAN LOCKYER: Now, when you say 14 00 are active, 
that means they've filed, or something. They may not be 
excavating? 



21 

MS. MILLER: Right, they're on the books, within our 
reports and on the books. 

CHAIRMAN LOCKYER: Of those 1400, your report says 
there's 14 6 that are abandoned? 

MS. MILLER: Well, yeah, when we take a look at what he 
added up, and he looked — I think it was 484 or 486 that 
were — that he looked at, plus the 14 6, I think is how he got 
to the 600. If we just subtract the duplicates of 71, from 600 
subtract 71 — I didn't do this in my head — but from 600, 
subtract the 71, plus we only checked on a few as far as, was 
there in place at the time active excavation, so it's still 
going to be our estimate is 69 percent of 1400 are mines that 
are in compliance, the remainder of which, 31 percent are out of 
compliance with financial assurances. 

So, I think the key here is next steps. This is the 
historical where we are, and I think the key is where we need to 
be in the future. 

One of the other things mentioned is, we hadn't had any 
enforcement of SMARA, and this might have meant no enforcement 
specifically based upon financial assurances, because we have 
taken 109 enforcement actions under SMARA, and about 10 we have 
taken to the Attorney General for prosecution under SMARA. 

But if you asked us specifically, have you taken any 
enforcement actions solely based upon financial assurances, the 
answer is no. And that's one thing that came to my attention 
with this inquiry, that we're changing our policy on that. 

I think when a law came into place in 1993, and for the 
first two years, trying to get mines into compliance was the 



22 

key, now it's time that we start taking action on those mines 
that are out of compliance and that are willfully out of 
compliance. 

CHAIRMAN LOCKYER: What kind of action? 

MS. MILLER: Well, the -- steps, when we saw the list, 
and I saw the concern, I've asked the staff to put together an 
enforcement policy. So, would we be going after mines first 
that had no reclamation plans, had no financial assurances, had 
not in any way tried to comply with the act, and going after 
those first? Which, we've already started that process, but 
focusing on those mines first, and then going through. 

The next step would be to take a look at those mines 
that have not been cooperating with the lead agencies and 
obtaining financial assurances, and go from there. 

One other issue as it relates to financial assurances, 
I think that's noteworthy that when you go through the list that 
had been sent to Senator Hayden, there's quite a few small mines 
listed. 

The issue with some of these small mines was, they 
don't have the financial wherewithal to secure a financial 
assurance. But there's other mechanisms that were established 
under the act, and one mechanism was to have the State Mining 
and Geology Board look at bonds pooling, to try to see if that 
would be an alternative method to get financial — get these 
mines in compliance. 

So, I've asked the State Mining and Geology Board to 
gear up. They've already had a few meetings with different 
financial institutions to come up with some recommendations. 



23 

I've already also promised Senator Sher that by this fall, I'd 
have recommendations to him on dealing with this financial 
assurance issue. 

CHAIRMAN LOCKYER: It's like a bond basically? 

MS. MILLER: It'd be a bond. There would be an 
industry pool of dollars, and it's just being able to set up the 
mechanism. 

There may need to be legislative changes to do that. 
We're exploring that: what's in the law that's allowable now, 
versus what do we need to come back to the Legislature for, for 
changes . 

The other issue is dealing on SMARA with lead agencies, 
and that sometimes being the cities or counties, and we're 
refocusing some attention. We had an effectiveness study come 
out in December. In that study, it recommended that we spend 
more time with lead agencies. So, I've asked staff to try to 
meet with each of the lead agencies each year, if we can, as 
resources permit. 

We're coming up with a quarterly newsletter directed 
towards them so we can talk about compliance with SMARA, how 
different lead agencies are dealing with different things, and 
focusing basically on lead agency assistance, and helping them 
get people in compliance with SMARA as well. 

I think that's about all the questions he had in there, 
unless I've missed something. 

CHAIRMAN LOCKYER: To make sure I understand, of the 
14 6 or so that seemed to perhaps have been abandoned, do we know 
how many of those sites taxpayers will be responsible for 



24 

cleaning up? 

MS. MILLER: The difficulty is, I think on that list, 
he asked for how many mines do not have interim management plans 
in place. Once again, it's a snapshot of who didn't have a 
plan. 

I guess the question is, what are these plans. If 
someone actually goes below less than ten percent annual 
production, then they need to file an interim management plan. 
And sometimes what that means is, just so that they have secured 
the site to be able to deal with — if anybody comes on to the 
site, from a safety standpoint, et cetera. And that would be 
what would be included in the interim management plan. 

And the fact that our report didn't reflect we had the 
plan doesn't necessarily reflect that the mine actually has been 
abandoned. We then have to go back and explore, case by case, 
what's the situation on this; is it the timing, that they filed 
it already with the lead agency but not with us yet. Those 
kinds of things that we'd have to focus on before we can come up 
with an actual number. 

But I guess my commitment here is, and why I shared the 
percentage figures, when we have 69 percent compliance with 
financial assurance, and I'm saying that that's not good enough, 
that I want to commit to increasing that compliance rate over 
time, and that's what I'll be asking staff to do, to come up 
with how do we get that compliance rate up very quickly over a 
period of time. 

CHAIRMAN LOCKYER: I guess the principle issue from 
Legislators who've asked is, is there some financial exposure to 



25 

remediation that the state needs to worry about? I don't think 
you have an answer for that. 

MS. MILLER: No, I don't have a specific answer for 
that. 

Certainly, if there are mines out there that have been 
completely abandoned, the operator's nowhere to be found, 
certainly there is, but no, I don't have an estimation of that. 

CHAIRMAN LOCKYER: Maybe in some subsequent 
discussion, you can help us with that? 

MS. MILLER: Yes. 

CHAIRMAN LOCKYER: Other questions on mining? Yes. 

SENATOR LEWIS: In the case where you have a mine 
that's out of compliance, for whatever reason, refuses to become 
compliant, what do you do? How do you shut them down? What's 
your course of action? 

MS. MILLER: The course of action on shutting down a 
mine is a pretty extensive process. It takes about six months 
and different actions we go through, and then there's appeals, 
et cetera. 

But let's say it's in the case of a mine that doesn't 
have a financial assurance, it's a small mine. So what we do 
is, we take the action to shut them down. The mine is shut 
down. 

Well, if they don't have a financial assurance, then 
the question is, how do we pay for remediation? So then in 
turn, we'd sue the mine to help pay for remediation, but if they 
didn't have the financial wherewithal in the first place, then 
we'd end up with an operator — without an operator, without the 



26 

money to clean up, and then that becomes the liability of the 
state. 

So, I think all along, a question has been, 
specifically with these smaller mines, to keep them producing, 
at the same time look at other mechanisms maybe other than 
shutting them down to get on the ground compliance with the act 
as being the highest priority for dealing with the issue. 

SENATOR PETRIS: Have you considered requiring them to 
post a bond? If some company comes along and says, "I want to 
open this mine," and in view of the track record here, there's 
14 6, a very large number that just aren't doing anything, and 
apparently don't even have the resources to pay a fine. I don't 
know. They haven't been fined very much. 

What about having some kind of security requirement up 
front for the state? 

MS. MILLER: That's actually — the financial 
assurances is, in a way, the security requirement not only for 
the local lead agency, but it's also with the State of 
California. And that's the whole purpose, that that financial 
assurance in place in the right amount to be able to cover for 
the reclamation. 

So, the law requires that now. That's where we're at 
69 percent compliance rates. So we've got 31 percent out of 
compliance with that financial assurance to make sure that that 
reclamation can be paid for. 

SENATOR PETRIS: What form do those assurances take? 
Do you just check their financial statement? 

MS. MILLER: No, actually it's pretty extensive. In 



27 

fact/ some have argued too extensive, and some financial 
institutions have input to us that it's very, very difficult for 
many people to be able to secure them. 

But to be able to actually have a bank sign on, to say 
that this amount of money' is available, let's say, if the 
individual went forward and went broke, or had a decrease in 
production, or whatever, and those are actually updated yearly, 
because certainly the financial status of the company could 
change yearly, as well as amount of excavation that has taken 
place, so, the amount that would need ultimately need to be 
reclaimed. 

So, that — financial assurances are actually updated 
yearly with the local lead agency and then reported to the. 

SENATOR PETRIS: What kind of mines are we talking 
about? Gold? Coal. 

MS. MILLER: Actually, there is no coal mines. I think 
I'm correct saying no coal mines in the State of California. 

The majority of the mines are actually gravel mines, 
aggregate mines, so sand and gravel mines are majority in 
numbers of mines in the State of California. 

SENATOR PETRIS: Are they actually mines the way we 
think of a mine, or are they open quarries? 

MS. MILLER: Well, if you're thinking of a mine that's 
a small hole into the side of a mountain, no, most of them are 
open. And under the act, that's what we're dealing with for the 
most part, is mines that do have challenges as far as dealing 
with need for reclamation afterwards. 

That's why we take so seriously the development of 



28 

those reclamation plans up front to how that mine will be 
reclaimed once mining has ceased. 

SENATOR PETRIS: I may not have caught your answer, but 
one of the complaints seems to be that the Department hasn't 
really been enforcing that part of the law to make them do what 
they're supposed to do. I didn't catch your answer. You 
probably answered it. 

MS. MILLER: We have been taking enforcement action. 
But specifically, if they're in compliance with everything else, 
but not financial assurances, in the past we have not. 

That's actually through this inquiry that Senator 
Hayden made that came to my attention. I'm changing that 
policy, that we will move forward also on financial assurances. 

Since the requirement's been in place really since '93, 
I think it made sense at the time to prioritize, in looking at 
our reports, our reclamation plans done. But I think the next 
step is to look at financial assurances. 

SENATOR PETRIS: You have quite a large number, 
apparently, that are operating without it. 

MS. MILLER: Well, like I said, some of these that are 
listed that are operating, that are operating without — 
actually, by law, can, because you don't need a financial 
assurance until you actually start excavation. So, that was one 
of the problems. 

When we were asked for list of who do not have 
financial assurances, it wasn't asking for which mines are out 
of compliance with financial assurances. And that's actually my 
— since this was developed, my staff's been working on that, to 



29 

go back to the lead ag-encies, find out what the status of the 
mine is, et cetera. 

SENATOR PETRIS: Are most of these, did you say, sand 
and gravel? 

MS. MILLER: Mainly sand and gravel. 

SENATOR PETRIS: Isn't there a tremendous demand still 
in California for sand and gravel? 

MS. MILLER: Yes, there is. In fact, that's another 
thing that SMARA does. We are required by the law to look at 
classification of mineral deposits in the state. Then that 
information is input to local government to then utilize in 
their decision making process. 

CHAIRMAN LOCKYER: Anything else on mines while we're 
on that topic. 

I guess staff knows that some of the mines out of 
compliance are very large, not just small ones. I guess your 
answer is the same in the phase — 

MS. MILLER: We need to focus on those, exactly. 

CHAIRMAN LOCKYER: The next issue, I guess, that would 
be worthy of discussion, let me lay the foundation, however, in 
this way. It has to do with the RFP on a study of recycling 
programs. 

One of the reasons the predecessor before you, that is, 
Mr. Heidig, didn't receive confirmation by this Committee is 
that he had a habit of doing these little RFPs with his buddies, 
and some of the same topics. Although, the one that was 
controversial at the time studied the oil industry regulations 
to see if they could be eliminated, and various kinds of efforts 



30 

to get around the requirements about bidding, and so on, were 
done . 

First/ sort of two questions have been raised, two or 
three, with respect to this RFP. First, you might tell us, 
where are we in the process? Is it wrapped, or what's 
happening? 

MS. MILLER: The process is, the RFP went out in 
February, and came back, and then proposals came back on March 
15, I believe the date was. 

We did select consultants to do this study, and we're 
in the beginning stages of formulating the scope of the study. 
And maybe, if we can go back through and discuss, you know, why 
we're proceeding, and those sorts of things. 

I came into this program very new to recycling, with no 
bias one way or another. For those of you that have worked the 
recycling issue before, and you take a look at the lobbying list 
who deals with recycling, and as you might well imagine, within 
a very short time that I was in this program, I was — these 
various individuals had an opportunity to chat with me. And it 
really showed me the diversity of this program that I had not 
realized was quite as diverse as it was. 

1178 last year to me was a resounding wake-up call for 
the Department of Conservation. When you have the Legislature 
mandating aggressive budget cuts to a program, and then you have 
the administration basically blessing those and saying, you 
really need to look at this program thoroughly, it was a signal 
to me that that's exactly what I needed to do. 

So, I decided to proceed with the study in January of 



31 

this year, to do a top-to-bottom review of the program, with 
everything on the table. And I'll reinforce no preconceived 
notions, to take a look at this program, and then have those 
consultants come back with some recommendations that then I 
could then utilize, with maybe some options of what the program 
may or may not look like in the future. 

It may very well validate much of what we have in place 
in California today. On the other hand, it might come up with 
some different ideas that then I can take to the Governor, and, 
I hope, ultimately to the Legislature to have you review for 
changes . 

So, that's — that was the initial emphasis of the 
start of the process in dealing with this recycling study. 

CHAIRMAN LOCKYER: Did anyone inform you at the time 
that the issue of this study was specifically raised during the 
discussion of Senate Bill 1178 and rejected? 

MS. MILLER: Well, in January, no, no one had. Since 
that time, especially, I had tried to see Senator Sher, and he 
had been extremely busy, obviously, this spring, and I got in to 
see him in April and May. 

When I had a chance, he raised the issue that it had 
been controversial. 

What I had heard was that there had been, from various 
players, that a study had been raised, but the issue had been 
should it be at Trade and Commerce Agency, or instead, should it 
be at the Department of Conservation. So, that was an issue I 
had heard. 

The other issue I heard, that there was a technical 



32 

advisory committee that had been discussed to be part of this 
study/ and that was very bureaucratic. 

Then the other issue I heard was the fact that the 
Department already had statutory authority to do the study, so 
that's why the administration had withdrawn the language. I 
think it went in on September 15th — September 5th and came out 
September 12th. 

So, after the fact, yes, I have. I have found that 
there was discussion. 

But I reviewed what occurred during the Natural 
Resources Committee, and there hadn't been much discussion 
because the language of the study had yet to be developed. And 
that would go in — actually, I think when it went to 
Appropriations is what had been discussed. So, there wasn't 
much help for me when I reviewed this a couple weeks ago to look 
at what was really discussed in the hearing. 

My understanding from staff is, they had not been 
involved at all on any of the discussions regarding the study 
contents. So, they were not knowledgeable about that. 

CHAIRMAN LOCKYER: How many consultants are there are, 
or how many groups work for you on it? 

MS. MILLER: What we were looking at, the RFP went out, 
and actually, that was another issue. And I take full 
responsibility for this, that the — I didn't want the 
Department of Conservation to come up with the scope of the 
study. So I asked the RFP to be written very broadly, and it 
was. I think that breadth elicited quite a few phone calls I 
received after the RFP went out, and rightfully so. 



33 

• 

So with that, we changed the actual contract with the 
contractors. The issue had been, we talked about review of 
waste programs. We didn't have any intent going out to review 
waste programs, but we wanted to look, instead of looking at the 
2020 program in a vacuum, we wanted to look at how it would 
complement other programs, like the 939 program. How it would 
fit in, and how it would, if we made changes to it, how it would 
affect. 

So, that's basically where we are on the contract. 
Really, how would it affect the AB 939 program. 

CHAIRMAN LOCKYER: So, this is not necessarily a 
re-evaluation of 939? 

MS. MILLER: No, absolutely not. 

CHAIRMAN LOCKYER: But for these ripple effects. 

MS. MILLER: Right, right. 
• CHAIRMAN LOCKYER: How many consultants have we wound 
up with? 

MS. MILLER: We have three consultants. They were the 
winning RFP, and that has been an issue that was raised. 

CHAIRMAN LOCKYER: Are they together? 

MS. MILLER: They are together. There's a central 
consultant, and that is Jim Gibson. He knows our program inside 
and out. And I think from — as complicated as the statute is, 
and this program is, he certainly has a lot of vast knowledge of 
the intricacies of this program. 

We also have Bill Shireman, and Bill Shireman was the 
original, I guess you could call him the father of the Beverage 
Container Recycling and Litter Reduction Act back in '86. He 



34 

had been with Californians Against Waste, so I thought he would 
provide a really good perspective of one of the leaders that got 
this program going in the first place. 

And then the person who has been somewhat controversial 
that Senator Sher had raised is Lynn Scarlett. And she's the 
vice president of the Reason Foundation. 

CHAIRMAN LOCKYER: Do they collaborate? Do the three 
of them submit one proposal? Is that how it works? 

MS. MILLER: The three of them will be working 
together. I really don't have any preconceived notions about 
the outcome. 

If there was a way that, through the process, and we're 
scoping the study, and before we finalize on what that scope is, 
and in light of Senator Sher's issues and concerns, we're going 
to float that scope out to get people's reaction to it. And 
then, we're basically turning the three consultants loose. 

And they're really responsible for gathering all the 
stakeholders, and being able to interview them, getting their 
ideas, their perspectives, and then coming back with 
recommendations this fall. 

CHAIRMAN LOCKYER: I guess what I don't understand 
about not what they'll do, but how they got to where they are 
now is, were each of the three hired independently, or did 
they — 

MS. MILLER: No, they came in with a bid on the RFP. 
They came in as a package, exactly, as a package. 

CHAIRMAN LOCKYER: I share Senator Sher's view that it 
is hard to expect unbiased commentary and analysis from Reason 



35 

Foundation. They start with a point of view that's, perhaps, 
legitimate and needed, but it would be like hiring the ACLU to 
comment on First Amendment issues. I know what they're going to 
say before they comment — 

MS. MILLER: Well, actually, one of the things in 
looking at Lynn Scarlett that I found noteworthy, in fact, it's 
a quote from Jerry Powell — who's publisher of the Resource 
Recycling Magazine, which is the number one recycling magazine 
in the state, and he's been an advocate of recycling for 20 
years — how he positions Lynn as, she's among group of diligent 
researchers whose writings force recycling advocates to rethink 
their position, and basically, others elect to use bits of data 
for their own purposes. 

So, you know, I like the fact that she's there to push 
the envelope, but at the same time, she is one of three, and 
she's a subcontractor for the study. 

The other thing is, I think, noteworthy that some of 
the recycling advocates have really touted some of the work 
she's recently done. She came out with — as a project leader 
on a study that's out that takes on building codes, and it takes 
on building codes from the standpoint that, because they specify 
materials versus tinsel strength, let's say, it actually 
precludes the use of recycled materials. So, that study in 
itself may really be an impetus to change some building codes. 

CHAIRMAN LOCKYER: Mostly plastic pipe. 

MS. MILLER: Well, lumber issues. Actually, I guess 
you can't call it lumber, but the actual that would be 
replacement for lumber is the majority of, I think, one of her 



36 

focuses in the study. 

CHAIRMAN LOCKYER: Other questions from Members? 

SENATOR PETRIS: Just to continue a little bit on the 
same vein. 

I'm concerned about two conflict areas, one that 
Senator Lockyer has mentioned. According to our notes here, Ms. 
Scarlett is known nationally as one who has stated in written 
articles in leading journals, you know, the Wall Street Journal , 
The L.A. Times , her open hostility to any governmental 
involvement in recycling programs, which gives her kind of a 
lopsided sided view coming into this kind of situation. 

I don't know how we can get a fair and open assessment 
if she has a strong view that says, recycling should be done by 
the free market, no government role whatsoever. 

I don't think it was the free market that started the 
recycling idea in the first place. I think it started with some 
bureaucrat somewhere. I wouldn't take a bet on it, but that's 
my gut feeling. 

The other area is, it goes back to the Governor under 
SB 1178. His clearly stated position, I think, puts him in 
conflict with what this program is supposed to achieve. So, 
you've got the appointing authority, plus the appointee, in a 
situation that, in my mind, raises some questions. 

MS. MILLER: I can ~ 

SENATOR PETRIS: Excuse me. 

I've raised this question before. What it amounts to 
is, you have a person with a long track record, with a well 
expressed, articulate, strong view on a policy. Then you 



37 

appoint that person to an agency to administer that policy, to 
which that person has been totally opposed all through the 
years. 

Well/ it's not fair for ask him or her to do an 
intellectual soramersalt and say, "All of a sudden, I'm all in 
favor of this. That's why I'm running it." 

This comes close to it. It's not quite as dramatic as 
some we've had in the past. 

MS. MILLER: As far as Lynn Scarlett is concerned? 

SENATOR PETRIS: Yes. 

MS. MILLER: One of the things that at least I've found 
with Lynn Scarlett, because I point-blank asked her that 
question, and she feels that there definitely is a role for 
government in recycling. A lot of things may be quality control 
and others. 

But I think the initial reaction of her saying, "All 
government as it relates to recycling is bad. It needs to get 
out. Government needs to completely get out of it," is not her 
perspective. 

But at the same time, that's also why I was pleased to 
see Bill Shireman and Jim Gibson also as contractors in this 
study, because I think we need to explore all the alternatives 
in order to have a credible study. 

To say, "Okay, we're looking at, what if government was 
not involved, what would be the end result of that? What would 
we have to give up if there wasn't certain parts of this program 
in place in the future?" 

Those are things I think we need to actually explore 



38 

and get those answers for. We may find those answers a little 
different than some people have as preconceived notions about 
the program. We may find that the intervention that we have in 
some areas is very valid. 

At least/ that's where I'm coming from, to look at 
having three different individuals involved in the development 
of this study with different points of view, definitely. And I 
think that, in itself, creates a balance for the study, that I 
want a clear factual review. 

When you talk about the Governor's — 

SENATOR PETRIS: You think you have balance there with 
the three? 

MS. MILLER: With all three of them, yeah,' especially 
Bill Shireman, having been the originator of the original Bottle 
Bill in California, and understanding — I mean, taking him — 
and I had talked to some environmental groups at first, and they 
spoke very highly of him, so I felt very comfortable with the 
fact that the three of them together applied and looking at that 
mix to get a variety. 

SENATOR PETRIS: Thank you. 

CHAIRMAN LOCKYER: Are there any other questions from 
Members. 

MS. MILLER: Was there a question as far as our 
statutory authority? I know that that was raised. 

We have specific statutory authority within our act to 
do studies like this. And we have done so in the past. 

CHAIRMAN LOCKYER: I notice the oil and gas study done 
by Mr. Heidig. He had statutory authority, and it was basically 



39 

junk. And the contractor, the bids were tampered with in order 
to get the right person he wanted to do the study, and then the 
pay is was increased. 

So, all I can tell you is, we look at the paper trail. 
Some of them change it before we get it; we've had that, too. 
Not him, different one. 

MS. MILLER: But I am a new Director, so I come with, I 
hope, a little different perspective than that. 

CHAIRMAN LOCKYER: I hope so, too. 

Did anyone present wish to make any comment. 

I note that we have till the end of Session to act on 
this. I'm going to recommend that we do that. 

Yes, please. 

MR. VINK: Thank you, Mr. Chairman. 

My name is Erik Vink. I'm with American Farmland 
Trust. We're a nonprofit farmland conservation organization. 

I'm here to speak in support of Elin Miller's 
appointment. We're very excited about this appointment. 

She's a strong exporter of agricultural land 
conservation efforts. She knows the issues, understands these 
issues better than practically anyone we've worked with in this 
position over the last decade, and in particular, is a real 
champion of the Agricultural Land Stewardship Program that was 
created in 1995 by Senator Costa's legislation. 

Elin's already been effective at securing federal 
moneys for this program from the farm bill efforts in 
Washington, D.C. She personally walked around the Governor's 
support letter and corralled a number of different people. We 



40 

are very pleased with her efforts there. 

She works well with a number of different individuals, 
I think/ as someone who can see all sides of the issue, asks 
incisive questions, and then takes action and is very 
proactive. 

In closing, we couldn't be more supportive of her 
confirmation and ask for your support. Thank you. 

CHAIRMAN LOCKYER: Thank you. 

Next. 

MS. HUMISTON: Good afternoon. Senators. Thank you for 
an opportunity to take just a few moments and speak in support 
of this confirmation. 

I'm Glenda Humiston. I'm currently serving as Vice 
President for the California Association of Resource 
Conservation Districts. 

Resource Conservation Districts, and I'll use the 
acronym, RCDs, around the state are responsible for the 
conservation of water quality, habitat, agricultural lands, and 
in particular, were formed to the reduce soil erosion back in 
the Dust Bowl days. Since then, we've expanded into working in 
urban areas, and have over a hundred districts serving over 80 
percent of this state. 

The Districts' philosophy is to try bring all the 
interest group and the issues to the table and find a solution 
to the problem, and avoid the litigation and conflict that, all 
too often, seems to be the only solution for these types of 
issues. 

In the short time we've worked with Elin, we have 



41 

noticed that she, too; has this philosophy of bringing the 
various interest groups to the table and utilizing all of them, 
and their ideas, to try to find workable solutions. And we have 
really appreciated this leadership from her. 

In particular, I would note that the California 
Conservation Partnership effort, which has been ongoing the past 
several months, has moved forward far rapidly because of the 
efforts of Elin Miller. 

We strongly support her confirmation to the head of the 
Department of Conservation. Thank you. 

CHAIRMAN LOCKYER: Thank you. 

MS. DELMATIER: Mr. Chairman and Members of the 
Committee, Denise Delmatier, with the Gualco Group on behalf of 
Norcal Waste Systems. 

We also would like to express our support for the 
confirmation of Ms. Miller. In particular, our client, Norcal 
Waste Systems, has a very long-standing history of operation in 
both the AB 2020 program and the AB 939 program. Norcal has 
many operations under the Convenience Zone Recycling Program, as 
well as the traditional Solid Waste Facilities Program in 939. 
I was one of those calls that Ms. Miller referred to 
as a result of the RFP going out for purposes of a recycling 
study. 

In particular, I'd like to comment on one previous 
study that prompted our strong concern regarding and the reasons 
we placed the call. Previous study. Little Hoover Commission's 
study, that took place a few years back, made some sweeping 
recommendations on overhauling the AB 939 program. 



42 

When that hearing took place in Southern California, I 
placed a telephone call to the Little Hoover Commission and 
posed the question as to what the contents and the substance 
matter of the study and the hearing would be. The answer that I 
was given at that time was that the hearing would be solely on 
the Beverage Container Recycling Program, and not anything to do 
with the AB 939 program. 

As a result, my discussions with other representatives 
of the waste industry, and the recycling industry, and the 
public waste industry, local government, none of us went down to 
that hearing. 

What took place, then, was a study, the Little Hoover 
Commission's infamous study, which made these sweeping 
recommendations as a result of Convenience Zone Operators and 
those interests commenting on the separate and distinct program 
under AB 939. 

Those recommendations then became the subject of 
legislative proposals which were extremely controversial, and 
were eventually defeated in the Legislature. 

So, when I called Ms. Miller, I requested some time, 
and quite frankly, was given an hour-and-a-half ' s time. As a 
result of some conflicting schedules, some of the other 
representatives of the waste industry couldn't make the meeting, 
and I requested that Ms. Miller reschedule the meeting. 

Her response to me was that, no, Denise, I'd really 
like to meet. And if it's only you, could you please come over, 
and I'd be happy to accommodate the schedules of the rest of the 
group at another time. 



43 

SO/ her interest in trying to address the concerns of 
the waste-recycling industry, local government, environmental 
community, I thought was very sincere and was very pleased at 
the response. 

And to reiterate what she said earlier in her 
testimony, she comes into this with no preconceived notions. 
So, when the study RFP went out, it was intentionally broad so 
as not to preclude and have a front-loading of bias going into 
the study. 

Quite frankly, that was the problem with the Little 
hoover Commission's study, a previous study, that is erroneous 
because it did not have the representation of the traditional 
waste recycling folks. 

Quite frankly, necessarily because of the overlap 
between the two programs, curbside operators who operate under 
the 939 program are not certified by the California Integrated 
Waste Management Board, but in fact are certified by the 
Department of Conservation. The Department of Conservation, the 
Division of Recycling, provides the only financing mechanism 
available to curbside recycling operators under their processing 
fee, and handling fee, and subsequent fees that were amended 
into the wonderful bill that this Legislature passed, SB 1178, 
O'Connell, of last year. 

So, there is a direct statutory cross-over between 
AB 939 and the 2020 program, and it presents a challenging 
problem for both the Waste Board and the Department to work 
together in a complementary fashion. 

We are encouraged by Ms. Miller's response to both 



44 

private meetings with myself, as well as representatives from 
the waste industry and local government that there will be the 
comprehensive look at these programs, and so that they can go 
forward in complementary fashion, and that both 2020 and 939 can 
be implemented, and stay successful, and continue to do 
wonderful recycling things that we've accomplished to date. 

I'd be happy to answer any questions. 

CHAIRMAN LOCKYER: Thank you. 

Next, Senator Ayala. 

SENATOR AYALA: I've listened to the testimony pretty 
closely, and I'm not going to question your statutory authority 
to conduct this study. 

My only question is, was this a budgeted item? Where 
did $300,000 come from? 

MS. MILLER: $300,000 is within our budget. And I 
guess — 

SENATOR AYALA: For what purpose? 

MS. MILLER: Up to $300,000 is within the contract for 
the study. 

SENATOR AYALA: The study was in your proposed budget? 

MS. MILLER: Not as a line item in the budget. Our 
budget has — in fact, there is a unit, and that's the statutory 
authority that I referred to before — a unit had been 
established a few years ago, that its basic charge is to analyze 
alternative programs, look at efficiencies, et cetera, et 
cetera, within the program. So, there's been a variety of 
different studies done before. 

For example, the Blue Ribbon Task Force was a report 



45 

that was published that Mr. Heidig had published while he was 
there. There's been an evaluation of public outreach with a 
study in 1993, as well as a non-CRV container sales study that 
was done by Earnst and Young as well in 1993, all under the 
provisions of this chapter. 

That's the thing — 

CHAIRMAN LOCKYER: Is it the general fund that supports 
that unit? 

MS. MILLER: No. These funds are funds that are in our 
CRV fund for the program. So, it's basically what's remaining 
when you've got about an 80 percent recycling rate, that's 20 
percent that isn't recycled, that is generated as part of the 
fund. So, it's within our budget authority under that fund. 

SENATOR AYALA: But during the budgetary discussions, 
did this surface before the conferees, that a study would be 
taken for this purpose? 

MS. MILLER: No, not to my knowledge. It would not 
have occurred. 

SENATOR AYALA: I'm not quite understanding where the 
money's coming from. Is it just a cushion your Department has, 
or where would $300,000 come from? 

MS. MILLER: We have within the unit, we have 
flexibility to do studies. We have contracts with a variety of 
people where we have flexibility to use that to analyze 
different parts of our program. 

And so, it was from, basically, the Division of 
Recycling's budget, that is made up of CRV, and processing fee, 
et cetera, that to do the study comes from. 



46 

I've been amazed, actually, at the amount of studies — 
and that's why I said, another study — the amount of studies 
that this particular Department has done regarding recycling. 

But when you take a look at the varied constituencies, 
$260 million we're talking about for a program, and so, I'm a 
rather frugal person, but you get what you pay for. 

My thought was first having outside consultants doing 
it so it wouldn't be biased by staff and by our own perceptions, 
so, those consultants doing it. And also having them involve a 
lot of outside stakeholders. That takes time, and so that's 
why we're looking at up to $300,000 to be able to perform this 
study. 

SENATOR AYALA: I guess the reason I bring it up is 
because I had an item removed by the conferees for mitigation of 
prison expansion in my area for the city and to the schools, and 
it was taken out completely. But we have money to provide a 
study for the recycling programs. 

I'm a little confused how that happens, how that comes 
about, that any agency has money available to make these 
studies, and yet the conferees denied something obviously that's 
needed to mitigate any expansion of prison facilities back in my 
home area, and they took it out. 

That's the reason I'm having a problem understanding 
where the financing comes for these programs. 

MS. MILLER: Once again, within our budget, and a lot 
of different studies have been done, but at least from what I 
have gathered, this is the first top-to-bottom, comprehensive 
review of this program, that we can put everything on the 



47 

table. Let's look at it and come up with some ideas and options 
that then we can bring forward to the Governor and the 
Legislature. 

CHAIRMAN LOCKYER: How many other studies are going on 
right now? Are there other contracts of this sort? 

MS. MILLER: Other contracts for studying recycling, 
none. 

CHAIRMAN LOCKYER: Any subject matter. 

MS. MILLER: Any subject matter, I believe we're doing 
a study with — in fact, it's about to be concluded — with the 
Department of Hazardous Substance, or Department of Health 
Services now, on — it's called a Norm study. It's on potential 
radioactivity. That study, I believe, had been called for 
because of some issues that had been raised nationally in oil 
and gas wells. So, that study is ongoing. 

The study you referred to before, the old oil and gas 
study, that came to my attention in December this year, and 
people were quoting the drafted study. And I asked for that 
study to be finalized, so we got it. We will get it out there. 

Also, the Board of Equalization needed some historical 
sales numbers, so I hope to have that study completed this 
summer. 

There was no specific statutory authority for that 
study. Instead, it was done under general authority, I 
understand, of the Department. 

CHAIRMAN LOCKYER: The Board of Equalization? 

MS. MILLER: Yes. This was the oil and gas study you 
referred to earlier that the Board of Equalization wanted to 



48 

utilize because of historical sales data that they could use for 
estimations. 

CHAIRMAN LOCKYER: Is there anyone else that wishes to 
comments? 

MR. MEACHER: Good afternoon, Mr. Chairman and Members 
of the Rules Committee. 

My name is Robert Meacher. I'm the Chairman of the 
Board of Supervisors for Plumas County, and I'm here also 
representing the Regional Council of Rural Counties today. 
Usually, you would probably expect to see Les Cohen, our 
legislative advocate, but the Rural Counties felt that this 
appointment was so close to home in affecting us that they asked 
me to come . 

I urge your support for the confirmation of Elin Miller 
as Director. I'll try to be brief, but there's a few points 
that I'd like to bring up to your committee today. 

And that is the fact that in rural counties, there's a 
lot of the Department's progrsims which impact our local 
governments, such as the Williamson Act and SMARA, which you've 
talked about, and also seismic hazard programs. 

We feel that Elin is an ideal appointee because of her 
proven track record with the County Agricultural Commissioners. 
I believe, if you have any backup in your packets, you've 
received several letters, or many letters, from Agricultural 
Commissioners, including one from ours, Fred Silver in Plumas 
County, who worked with Elin when she was at the Pesticide 
Board. 

She's already reached out to local governments and 



49 

planners, and I'm going to read you some bullets here. 

At the Department of Conservation, she has initiated a 
strategic planning process in inviting those entities directly 
impacted by Department programs, including the rural local 
governments, participate in the Department's strategic planning 
focus groups and develop recommendations for improving how the 
Department serves its clients. 

She has met with the planning directors and supervisors 
to find out what issues they have with the Department programs, 
and how the Department can provide needed services. 

As a representative of a rural county, and for RCRC, 
the Regional Council of Rural Counties, I believe Elin's 
background, and with my conversations with her, because I sit 
and represent the rural counties on the Governor's Executive 
Council on Bio-diversity, Elin's one of the department heads 
that's there. It gives us an opportunity to talk. There's 
other rural counties that Elin has talked with. She's addressed 
a Board of Directors for RCRC. 

All the counties in RCRC feel very comfortable with 
this appointment. For example, the Surface Mining and 
Reclamation Act, it is a relatively new program for local 
governments which have active mines in their jurisdiction. It's 
a very complex program for our small planning departments to 
deal with. 

Elin has expressed her interest in working with us on 
that to achieve the goals of SMARA. Rural counties have a more 
difficult time with compliance due to the lack of expertise that 
we have and financial resources. 






50 

We also are burdened with the fact that in a county 
such as Plumas, which is about the size of the state of 
Maryland/ 75 percent of our land base is federally controlled. 
So, with that in mind, there's a real need for the Department to 
help us inter-react with the federal agencies when we're dealing 
with SMARA compliance. Believe me, working with the Forest 
Service is not always easy to do when it comes to SMARA., and I 
am personally aware of some problems in just communication. And 
I see the DOC as integral as far as small, as in resources, 
financial resources, a small county having the Department's help 
in dealing with SMARA and the federal agencies, communication. 

She will not be skirting her responsibilities with the 
implementation of the act. She's a problem solver and can 
address the problems that remain with the program. She's 
helping us implement the program. For example, she's directed 
staff to provide technical advice to lead agencies which don't 
have the expertise in SMARA, as I just mentioned. 

We believe that Elin's proactive, that she's moving in 
the direction the Governor intended, on both human resources and 
natural resources, taking a proactive role. 

We encourage the Committee to support us in confirming 
Elin. 

CHAIRMAN LOCKYER: Thank you. 

MR. MEACHER: Any questions? Thank you. 

CHAIRMAN LOCKYER: Thank you. 

Anyone else who hasn't commented? Yes. 

MS. BARR: Mr. Chairman, Members of the Committee, I'm 
Linda Barr, representing the Sierra Club. 



51 

While we're not here in specific opposition to Ms. 
Miller's appointment/ we do have serious concerns regarding the 
Department of Conservation's lack of enforcement of the Surface 
Mining and Reclamation Act. Many of these issues have already 
been raised and discussed here this afternoon. 

The Department of Conservation has clear authority to 
enforce compliance with SMARA, and they should be doing a whole 
lot more. We- believe that proper reclamation is the 
responsibility of the mining owner, not the public. We're 
really concerned that the public will end up footing the bill 
for the lack of enforcement. 

So, we hope you'll take these significant problems into 
account as you consider Ms. Miller's appointment, and we hope 
that enforcement of SM7VRA becomes a top priority for the 
Department . 

Thank you. 

CHAIRMAN LOCKYER: Have we heard from everybody who 
wishes to comments. 

Let me ask with respect to the Williamson Act, that's 
been the area that there seems to have been the most enthusiasm 
from those that you work with about your attitudes and efforts. 

Following up on that, are there are any particular 
problems associated with preserving ag. land that you'd like us 
to just know about, that we ought to be thinking about in terms 
of legislative or budgetary matters, or anything of that sort? 

MS. MILLER: There certainly are a lot of challenges 
for the future. There's been some studies that have looked at 
specifically the Central Valley and some challenges there in the 



52 

future. The potential of a million acres prime farm land going 
out of production by, say, the year 2040, was a report that was 
issued this fall. 

I think that points to the need for us to look at a lot 
of different opportunities and tools. We have the Williamson 
Act Advisory Committee that is basically there to look at 
refinement of the act, to look at different changes in the act 
itself. 

But we're also branching out, and I co-chair that 
committee with the Department of Food and Agricultural, we're 
branching now into looking at other tools. One such tool was SB 
275 that Senator Costa passed last year, to look at long-term 
conservation easements. We're exploring other possibilities of 
other tools that can be lent to local agencies, because it's 
really a local decision. But as far as I see my role in the 
state, if we can provide a variety of tools, a variety of data, 
that then the local communities can utilize to make their 
decisions, that's the key. 

CHAIRMAN LOCKYER: Okay, if there aren't other 
questions, I'd like to suggest that you have an opportunity to 
talk with the Senators who've expressed concerns before we go to 
vote. I think it would be useful for them to hear some detail 
about the methodology of the study, things of that sort, just so 
they'll be better acquainted with the facts. 

SENATOR BEVERLY: On that study, I want to ask one 
question. 

When is it due? 

MS. MILLER: I would like to see the study completed by 



53 

« 

this fall. Not knowing exactly what the result is going to be, 
if there's a lot of concensus/ then I'd like to have that go 
then as a recommendation to the Governor, then come out as a 
legislative package. 

SENATOR BEVERLY: By the terms of the contract for the 
study, when is it due? 

MS. MILLER: This fall. 

SENATOR BEVERLY: Like? 

MS. MILLER: I think it's October is the date. 

CHAIRMAN LOCKYER: We have to act on this before the 
end of August. 

Senator Petris. 

SENATOR PETRIS: I want to go back to those 14 6 mines 
that have ceased operation and may be illegally abandoned 
without doing a proper reclamation, and so forth. 

Can you find out for us how much that would cost the 
taxpayers if that condition continued and none of the owners 
came back to do what they're supposed to do after abandonment? 

MS. MILLER: If there already has been a rec. plan 
filed, yes, that would be a lot simpler, or then we could take a 
look at those. 

But if the question is total amount of dollars that the 
state would be liable for if all of them were, is that your 
question? 

SENATOR PETRIS: Yes. 

MS. MILLER: We could probably come up with an estimate 
for you. 

SENATOR PETRIS: At least an estimate. 



54 

MS. MILLER: Yes, but to understand, once again, the 
characterization of those being abandoned mines by law is not a 
correct assumption. Those are mines that require interim 
management plans so we can come back and say, for the mines 
within this universe that we feel are potentially abandoned, I 
think, is a different look than to say which have or have not 
filed, because of reporting time, interim management plans. 

I think you're trying to get to the bottom line, I 
assume. It's what's the liability for potentially abandoned 
mines. And I think we could come up with some kind of an 
estimate. 

SENATOR PETRIS: Thank you. 

CHAIRMAN LOCKYER: I would guess that's the kind of 
question Senator Sher will want to have an answer to. 

MS. MILLER: Well, that, or my thought is that he 
probably wanted to focus on, really, what am I doing. And the 
focus of gearing up our enforcement activity in this area is 
where I'm headed. 

CHAIRMAN LOCKYER: I think that's constructive, so I'd 
like to just recommend you do that in the next couple of months. 
I think that'll help. 

The other thing I would just point out, the oil and gas 
study we're dusting off or completing, I don't remember all the 
details, but I remember the same argument being made, that we 
didn't want the bias of the state employees, so they contracted 
with someone who works for the oil industry. 

MS. MILLER: I understand. 

CHAIRMAN LOCKYER: That's who you're getting with your 



55 

consultant. 

SENATOR PETRIS: Same question on the ones that are 
currently operating without financial assurances, 486? 

MS. MILLER: Uh-huh. 

SENATOR PETRIS: If they figure out they can't do it, 
and they skip out, what would that is cost be? Might be 
difficult to estimate. 

MS. MILLER: We can take a look at that too, because I 
think the whole key there is, there's quite a few that are in 
that small mine category. And if we come up with some solutions 
with the this bonding mechanism, then, in essence, we'll be able 
to take care of that whole group and get those in compliance, 
and that being a high priority, to get those mines in 
compliance. 

SENATOR PETRIS: Thank you. 

CHAIRMAN LOCKYER: Thanks a lot. 

Anything you want to say in conclusion? We'll be back 
on the agenda, perhaps for a vote only, but we'll have some more 
conversation about some of the studies and details. 

MS* MILLER: Okay. As far as timing, you said to try 
to get with Senator Sher. Was there another Senator you 
suggest? 

CHAIRMAN LOCKYER: The Chair of the committee. 

MS. MILLER: Talk to Senator Hayden? 

CHAIRMAN LOCKYER: Yes, I think it would be useful to 
visit with them, and hopefully that'll assist in — 

MS. MILLER: Speeding it along and resolving the 
issue. 



56 

I appreciate your time. And I had hoped I would be 
able to fully answer all your questions. Certainly, if there's 
any additional -- 

CHAIRMAN LOCKYER: You did very well, but let's wrap 
some of the details. 

MS. MILLER: Okay, great. Thank you. 

CHAIRMAN LOCKYER: Thank you. 

Mr. Sterpa is next. Good afternoon, sir. 

MR. STERPA: Good afternoon. 

CHAIRMAN LOCKYER: How are you? 

MR. STERPA: Mr. Chairman, Members of the Committee, 
Ms. Michel, I'm here this afternoon to seek your reconfirmation 
to the Board of Directors of the California Housing Finance 
Agency. 

I was first elected — or appointed to the California 
Housing Finance Agency in 1984. For the past 12 years, I have 
had the responsibility of giving directions to the 
fourteen-member Board. 

I think the accomplishments of the Agency are very 
numerous. I feel that I've been part of it. We have seen a 
struggling agency at the beginning to be a very forceful agency 
that is more like a financial institution of the State of 
California. 

As far as my qualifications, I'm sure that you have it 
in front of you. If there is anything that I can do to answer 
any of the questions, please feel free to ask. 

Thank you. 

CHAIRMAN LOCKYER: Thank you-, sir. 



57 

Well, I always defer on matters of the Mediterranean to 
the reigning Greek. 

SENATOR PETRIS: First cousins. 

MR. STERPA: That's right. 

CHAIRMAN LOCKYER: What's been the toughest problem 
during your years of service? Is there any that stands out in 
your mind that is a persistent difficulty? 

MR. STERPA: Not really. Our biggest difficulty has 
always been not enough money to help the first-time buyers and 
the low and very low income tenants. 

Somehow, we have managed to be able to live with it. 
We have increased our allocation. We have had our allocation 
increase through the years. We have, through recycling of 
bonds, bond issues, we have increased what we can do for the 
people of the State of California. 

And we are very proud that from anywhere approximately 
less than one billion dollars in loans made prior to 1984, we 
are today, we're maybe in excess of $7 billion in loans, and 
about 60,000 first-time buyers have been served, as well as 
15,000 low-income tenants have been also been helped. 

CHAIRMAN LOCKYER: So, do you have a view, Mr. Sterpa, 
on whether there should be a consolidation of housing agencies 
and programs in the state. 

I guess we have three, if you count the Department, and 
then the Agency, and then the Tax Allocation Committee. 

Would there be efficiencies achieved if they were 
consolidated, or does it matter? 

MR. STERPA: Well, I you understand that there was a 



58 

study made. And there were 331 -- approximately 31 programs in 
effect here in the State of California. 

CHAIRMAN LOCKYER: Yes. 

MR. STERPA: They have asked our Agency to be part of 
it, or a possible solution, but after many hashing things over, 
it said the conclusion was to leave the things alone. 

Remembering that our Agency's more like financial 
institution, we get involved in loaning money rather than making 
policies for the State of California. 

CHAIRMAN LOCKYER: Other questions from Members. 

SENATOR PETRI S: Yes, Mr. Chairman. 

I'm wondering about the fact that we have three 
different state housing agencies: ACD, and the California 
Housing Finance Agency, and the Tax Credit Allocation 
Committee. 

With limited resources that we have, this seems to me 
to have a lot of duplication, where a streamlined consolidation 
might be much more helpful. 

Have you seen that as a problem from where you sit? 

MR. STERPA: Well, from our point of view, I personally 
do not get involved in these matters. 

Our policy, the policy of the Board is to develop 
policies for making loans at CHFA. As I said, it seems like 
that they have been talking about consolidating. HCD does a lot 
of things that we do not do. 

We only makes loans to first-time buyers, and make 
loans to multi-family units when those multi-family units are 
serving low and very low income tenants. That's only our only 



59 



purpose. * 

SENATOR PETRIS: That's in the multiple. 

In the single family, one of my concerns over the years 
has been too much emphasis on the single family dwelling/ which 
takes a higher income person. I don't mean high income, but 
certainly above the low and very low income level. 

I'm concerned about the proportion of our money that's 
being allocated for what I think was the original intention, for 
low and very low income people, to provide a roof over their 
heads through the loan program. 

What is that proportion today? 

MR. STERPA: We have increased tremendously the amount 
of money that we are allocating and giving to multi-family 
units. In fact, I can say that even three years ago, we had $31 
million worth of low income family dwellings. And today, we 
have in excess of over 97 million for the year 1997. So, has 
been a tremendous increase. 

We haven't turned down any of the multiple units that 
have been brought to us, unless they were not worth dealing 
with. We are seeking a lot of nonprofit organization coming to 
us, because we feel that not only they are equipped to handle, 
and they come in with a certain amount of money of their own, 
and they're not looking for profits. They're looking only to 
serve the low income and very low income tenants. 

SENATOR PETRIS: Would you say that their role has 
increased since you've been appointed? 

MR. STERPA: Yes. We have seen the role of the 
multi-family unit increase tremendously. And we hope that in 



60 

the -- we have a five-year study, or actually a five-year plan. 
At the end of this cycle/ the five-year cycle, we'll be doing in 
excess of $750 million worth of low and very low income family 
units. 

SENATOR PETRIS: Do you have an inventory of what the 
need is? 

MR. STERPA: At this present time, the inventory of 
single family residence is approximately 45 billion — I'm 
sorry, 45,000 loans. In the multi-family units, we have an 
inventory of about 17,000 units. 

SENATOR PETRIS: What's the need beyond that? 

MR. STERPA: In need, very frankly, the need at this 
present time, we had a very lack of need for a while because of 
the prices here in California rising so fast and so high. But 
this last year or two, we have seen an increase in demand for 
that. 

And we are fortunate that between what we have been 
allocated and we are recycling from previous bond issues, we are 
able to meet all the needs that are asked. 

I can say that if we relax additional — what we asking 
for, we could be doing much more. But we really don't have the 
money. Also, I'm not sure that we would be serving the purpose 
of the state by doing that, relaxing our requirements. 

SENATOR PETRIS: Another way to do it would be to have 
one agency instead of three. 

MR. STERPA: Well, it has been before talked about, the 
possibility of doing. 

SENATOR PETRIS: We have 31 different programs. 



61 

MR. STERPA: The 31 different programs, the only 
program that really is financially responsible, without giving 
anything away, and also helping, is the California Housing 
Finance Agency program, because we don't depends on the state 
fund. We go out in the market and borrow money, and we pay them 
back. And we — in fact, our record is extremely great because 
Standard and Poor, they've given us a double-A rate. And so. 
Moody has given us A-one-plus rate. 

SENATOR PETRIS: What's the percentage of that money 
that goes into multiple housing, and what percentage goes into 
the single family? 

MR. STERPA: Usually it's about anywhere, 75 percent to 
single family, and 25 percent to multi-family. 

But again, I want to emphasize that we haven't turned 
down any multi-family unit that they've asked us to finance. 

SENATOR PETRIS: As long as they're within the 
eligibility. 

MR. STERPA: Correct. 

SENATOR PETRIS: Apparently there's been some criticism 
of your collection and reporting of data. Not you, the Agency, 
I mean. 

You're required now, since 1988 — actually it was 
1989, to provide information to the Legislative TVnalyst so they 
can issue an annual report on the housing that's financed with 
tax-exempt mortgage revenue bonds issued by CHFA and local 
government agencies. 

We're trying to get a handle on the tremendous amount 
of overlapping and so forth. 



62 

Are you familiar with that effort to improve? If you 
are, how is it coming? 

MR. STERPA: Well, I was a little surprised hearing 
that there has been criticism. 

CHAIRMAN LOCKYER: Excuse me. Let me just interrupt so 
that we can open the roll. Senator Lewis has to leave and wants 
to be reported as voting Aye. 

SENATOR LEWIS: That's right. 

MR. STERPA: I was very surprised to hear that there's 
been criticism of the Agency on reporting. I know that our 
financials have been provided to the Legislature every year — 
well, since I — I thought it had been provided before 1989, but 
definitely — 

SENATOR PETRIS: Let me put it a different way. 

The complaint is that there's so many inconsistencies 
in the manner in which CHFA And the CDAC, the Debt Advisory 
Commission, collect and report the data, it makes it almost 
impossible to get all the information that's required by the 
Legislature. I don't know what makes it so complicated, but it 
also makes the annual review of the efficiency much more 
difficult. 

MR. STERPA: Senator Petris, I would like to say that 
I'm surprised at this. 

I would also like to promise to you and all the Members 
of the Committee that I will have Maureen Higgins investigate 
your question. And all of you will be receiving an answer from 
us. 

I apologize. I wasn't aware of it. 



63 

SENATOR PETRIS: I can understand that. You may want 
to check with the Legislative Analyst, whoever is handling that 
in that office, and they can give you a little background on 
that/ and provide you with the proper questions. 

My basic concern, I might like to have you check on 
that, too, is the imbalance between the low and very low income 
level applicants, and the moderate or average income. For 
single family, it tends to be moderate and average income, of 
course, and the very low go into the multiple housing, which is 
understandable . 

MR. STERPA: Well, we have adopted not too long ago a 
risk share program with FHA. And we are now in progress of 
coming up with about 7800 units that will be financed through 
this risk share between money that we have and money that FHA 
would be allocating for us. 

And believe it or not, Maureen has done is such a great 
job with FHA, that they have actually allocated for us 25 
percent of the total amount of money that is being allocated in 
the United States for this, effort. This will be going -- 
definitely be going to multi-family units. 

If I may say, sir, we are very responsive. Any time 
that someone would like to make — tell us that possibly we are 
not doing something, and anything that we can do within the 
scope of the California Housing Finance Agency, we will be very 
happy to accommodate, especially low income and very low income 
tenants. 

SENATOR PETRIS: There's some more specific information 
that says that a significant number of the single family homes 



64 

that are financed by your agency are in areas with relatively 
moderate housing costs and great amounts of new housing 
construction. The examples they give are Sacramento, Fresno, 
San Bernardino/ Kern, Riverside, Tulare. Those counties 
together provide more than two-thirds of the CHFA single family 
loans. 

That's because the amount of assistance that you're 
offered, I guess, through your limited resources is very 
modest. It's not quite enough to bring those in the lower level 
into the program. 

MR. STERPA: Senator Petris, we did something about 
that. 

At my last confirmation hearing, I had Senator Mello 
that brought that up. As you know. Senator Mello was from 
the — is from the Salinas and Monterey County. 

And he was wondering why his county wasn't getting any 
money, wasn't getting money. 

And I said, well, the only answer I had at the time was 
that prices were too high in that county, and people were making 
too much money. All those ones not. making enough money, the 
property values were too high. 

We did something about that. In this last three 
years — five years, as a matter of fact, we have gone through 
one decreasing in certain areas, high cost areas, such as even 
San Francisco, or Los Angeles, San Diego, any place, or even the 
Monterey County area, we have the decreased interest rate that 
we charge the buyers. We have given them 97 percent loan. We. 
have relaxed our standards for qualifications. 



65 

And believe it or not, all of a sudden from 20 percent 
in these high cost area, from 20 percent of our loans were made 
there, now we are up to 35 percent. Trust we like to do more 
than that, but you know, there is so much — prices are what 
they are, and qualifications are what they are also. 

But we are doing something about that. 

SENATOR PETRI S: Thank you. 

CHAIRMAN LOCKYER: Is there anyone present who would 
wish to wish to ask any questions or make any statements. 

Members of the Committee, that about does it. 

Oh, I should ask, this is my only test of your service, 
how are you getting along with Maureen Higgins; okay? 

MR. STERPA: I forgot to tell you, I have had three 
great Directors: Carney Hodge, who really put a lot of work in 
the Agency; then I had John Seymour, who really formulated a lot 
of new plans; now I have somebody who really does — puts the 
things together. She knows the legislative arena. She knows 
how to handle the staff. I'm extremely proud to have her as our 
Director, thank you. 

SENATOR BEVERLY: Move we recommend confirmation. 

CHAIRMAN LOCKYER: We have a motion to recommend 
confirmation. Call the roll and add Senator Lewis as an Aye. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis added Aye. 
Senator Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 



66 



SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Five to zero. 

CHAIRMAN LOCKYER: Good luck. 

MR. STERPA: Thank you very much. 

[Thereupon. This portion of the 
Senate Rules Committee hearing was 
terminated at approximately 3:57 P.M.] 
— ooOoo — 



67 

CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California/ do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 

z£ IN WITNESS WHEREOF, I have hereunto set my hand this 
(^j)__ day of ^ -^^tU^-r*-^^^ , 1996. 






J. KIZAK 
Shorthand Repoil^r 



^ 



305-R 

Additional copies of this publication may be purchased for $3.75 per copy 
(includes shipping and handling) plus current California sales tax. 

Senate Publications 

1020 N Street, Room B-53 

Sacramento, CA 9581 4 

(916)327-2155 

Make checks payable to SENATE RULES COMMITTEE. 
Please include Stock Number 305-R when ordering. 



L S'oo 



JUL 1 7 1996 

PUBLIC UBRARY 



^.HEARING 

, SENATE RULES COMMITTEE 

# //// 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

MONDAY, JUNE 24, 1996 
2:37 P.M. 



306-R 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 



MONDAY, JUNE 24, 1996 
2:37 P.M. 



Reported by 



Evelyn J. Mizak 
Shorthand Reporter 



11 



APPEARANCES 

MEMBERS PRESENT 

SENATOR WILLIAM LOCKYER, Chair 

SENATOR ROBERT BEVERLY, Vice Chair 

SENATOR RUBEN AYALA 

SENATOR NICHOLAS PETRI S 

MEMBERS ABSENT 

SENATOR JOHN LEWIS 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 

PAT WEBB, Committee Secretary 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

DOUGLAS N. CORNFORD, Member 
Industrial Welfare Commission 

JIM ABRAMS, Executive Vice President 
California Hotel and Motel Association 
California Lodging Industry Association 

JULIANNE BROYLES 

California Chamber of Commerce 

WILLIE WASHINGTON 

California Manufacturers Association 

TOM RANKIN 

California Labor Federation, AFL-CIO 

DON WATSON 

International Longshoremen and Warehouse Union 

FERN M. LAETHEM, State Public Defender 

JAMES M. STUBCHAER, Member 

State Water Resources Control Board 

SENATOR JACK O'CONNELL 



Ill 

INDEX 

Page 

Proceedings 1 

Governor's Appointees; 

DOUGLAS N. CORNFORD, Member 

Industrial Welfare Commission 1 

Background and Experience 1 

Questions by CHAIRMAN LOCKYER re: 

Circumstances under which Petitions 

Come before Commission 4 

Identification of Orders 5 

Process with Respect to Five Orders 

Sent to Wage Boards 5 

Vote on Minimum Wage 6 

Witnesses in Support; 

JIM ABRAMS, Executive Vice President 

California Hotel and Motel Association 

California Lodging Industry Association 7 

JULIANNE BROYLES 

California Chamber of Commerce 9 

WILLIE WASHINGTON 

California Manufacturers Association 9 

Questions by SENATOR PETRIS re; 

Long Meetings 12 

Flat Rate of Pay for 

Commissioners 12 

Questions by SENATOR AYALA re: 

Failure to Act on Minimum Wage 13 

Questions by CHAIRMAN LOCKYER re: 

Opposition in File by Labor Community 14 



IV 



witnesses in Opposition: 

TOM RANKIN 

California Labor Federation, AFL-CIO 14 

Questions by SENATOR PETRIS re: 

Current Minimum Wage if IWC 

Had Taken Appropriate Action in 

Past Years 19 

Questions of Nominee by SENATOR PETRIS re: 

IWC Doesn't Want to Raise Minimum Wage 19 

Status of Wage Board ' s Report to IWC 19 

Membership of IWC 20 

Questions by SENATOR BEVERLY re: 

Vote Cast on Minimum Wage 20 

Questions by CHAIRMAN LOCKYER re: 

Prior Service on Wage Study 20 

Votes while on IWC that Might Be 

in Opposition to Administration 21 

Stalling Tactics 22 

Overtime Issue 22 

Vote on Almond Processors 23 

Current Process for Allowing Workers 

to Vote for Increased Workday Hours 24 

Response by MR. RANKIN 25 

Questions by SENATOR PETRIS re: 

Plight of Farmworkers in California 26 

IWC Meeting in Fresno 27 

Ideas for Improving Conditions for 

Farmworkers 27 

Commissioners Being Apprised of Working 

and Living Conditions of Farmworkers 28 



Action 'that Might Be Taken by IWC 29 

Extent to which Commissioners View 

Conditions in Field 31 

Availability of Staff 31 

Ways in which Additional Staff 

Might Be Utilized 32 

Questions by CHAIRMAN LOCKYER re: 

Semi-feudal Attitudes of Growers 

in Some Areas of California 32 

Questions by SENATOR AYALA re: 

Process for Considering Change in 

Minimum Wage 33 

Inability of Commission to Act without 

Calling for a Wage Board 34 

DON WATSON 

International Longshoremen's and 

Warehousemen ' s Union 34 

Recommendation by CHAIRMAN LOCKYER that 

Committee Hold Appointment in Committee 35 

FERN M. LAETHAM 

State Public Defender 36 

Brief Opening Statement 36 

Questions by CHAIRMAN LOCKYER re: 

Difficult Issues during Tenure 37 

Shortage of Attorneys 37 

Assistance of Private Court-appointed 

Counsel 37 

Proposal for Habeas Corpus Unit and 

Direct Appeal Unit 38 

Questions by SENATOR PETRIS re: 

Impact of Federal Legislation to 

Limit Appeals 39 



VI 



Questions by SENATOR AYALA re: 

Legislation which Mandates that Defendants 

Must Pay Public Defender for Representation ... 40 

Lack of Offices in Southern California 41 

Motion to Confirm 41 

Committee Action 42 

JAMES M. STUBCHAER, Member 

State Water Resources Control Board 42 

Introduction and Support by SENATOR JACK O'CONNELL ... 42 

Background and Experience 42 

Questions by SENATOR AYALA re: 

Need for Additional Supplemental 

Water for Southern California 43 

Source of Water to Meet Quality 

Standards in San Francisco Bay 44 

Questions by CHAIRMAN LOCKYER re: 

Lack of Correspondence in File from 
Environmental Groups 46 

Hardest Vote while on State Board 46 

Possible Exhaustion of Groundwater 

Supplies 47 

Questions by SENATOR AYALA re: 

Position on Building Hold Facilities 

to Capture Flood Waters 48 

Statements by CHAIRMAN LOCKYER re: 

Duration of Term 49 

Motion to Confirm 50 

Committee Action 50 

Termination of Proceedings 50 

Certificate of Reporter 51 



P-R-0-C-E-E-D-I-N-G-S • 
— ooOoo — 

CHAIRMAN LOCKYER: Appointees, Mr. Cornford. Good 
afternoon. Sorry to keep you waiting. 

MR. CORNFORD: No problem, sir. 

CHAIRMAN LOCKYER: Do you want to start with a 
statement? 

MR. CORNFORD: If it pleases the Chairperson. 

CHAIRMAN LOCKYER: Sure. 

MR. CORNFORD: Chairman Lockyer, distinguished Members 
of the Senate Rules Committee, thank you for this opportunity to 
appear before you today relative to my appointment to the 
Industrial Welfare Commission. It's a privilege and honor. 

I realize that in the performance of your varied 
responsibilities and duties on behalf of the State of California 
you are called upon, as you are today, to pass judgement on the 
qualifications of many individuals seeking confirmation to 
various state boards and commissions. 

Obviously, the issue before you today is whether or not 
Doug Cornford should have the recommendation of the Senate Rules 
Committee for confirmation to an employer seat on the Industrial 
Welfare Commission. 

If I might be slightly presumptious, let me offer a 
couple of affirmative thoughts for your consideration. 

First, even though I have been nominated for the IWC 
position by the incumbent administration to fill an open 
employer seat, I can assure you that I am not a rubber stamp for 
the administration. Additionally, I am not an ideologue, but 



rather a centrist and will act as my conscience, faith, and 
intellect dictate. 

Second/ there is no denying, nor will I attempt to do 
so, that I come to the Commission with an employer-oriented 
background, which is no different than a labor seat appointee 
coming to the Commission with a union-oriented background. It's 
my understanding that the Commission was originally legislated 
into existence with this diversity of perspective in mind. 
However, I come to the Commission equally independent of being 
an employee of any statewide employer group or association, an 
independence that has been manifested on my votes on the 
minimum wage and overtime issues presently before the 
Commission. 

Third, I come to the Commission as a native-born 
Californian with an educational background and practical work 
experience spanning some 35, 36 years in dealing on daily basis 
with the very subjects and topics that are the responsibility of 
the Commission. My life's work and education have been in the 
field of employee/employer relations, a subject that is at the 
very core of what the Commission is all about. 

Fourth, contrary to what some professional union staff 
members may wish to believe, I have a deep and abiding respect 
for organized labor and the historical contributions that they 
have made and will continue to make on behalf of working men and 
women . 

I would also like to believe that those elected union 
officials who have interacted with me on a regular, ongoing, 
daily basis would confirm that I am approachable, willing to 



listen, a person who keeps their word, and someone who can be 
worked with on difficult and complex issues. 

Fifth, as you are aware, I've had the privilege of 
serving on the Commission for the past eleven months, a time 
that has been very special and unique. A time to experience 
first-hand the broad diversity and complexity of the California 
work force and business community. I have attempted with all 
good conscience to keep an open mind on all of the issues and to 
be an active participant in the work of the Commission. 

As a result of this experience, I did vote in favor of 
calling a Minimum Wage Board on the basis of the testimony that 
the current minimum wage may not be adequate, and secondly, 
proposed a motion to not open the issue of alternatives to the 
eight-hour day for 10 out of the Commission's 15 wage orders. 
Votes that may not be strictly in line with the wishes of some 
members of the business community, but votes that do represent 
my independence and ability to interpret the evidence before the 
Commission. 

In closing, I would, if the Rules Committee concurs, 
like to continue to serve on the Commission. It is interesting, 
fascinating, and vital work. And it has been my pleasure to 
have been part of the Commission's activities. 

I recognize that each of us may have differing views on 
what rules and regulations may be in the best interest and 
welfare of the working people of the state. But I can assure 
you that if confirmed, I will continue to attempt to do the best 
job I can for the ultimate good and benefit of all Californians. 

Thank you for letting me make this opening statement. 



Should you have any questions, I will do my best to answer them 
for you. 

CHAIRMAN LOCKYER: I guess one issue that you might 
just tell us about is the discussions that have occurred 
regarding the eight-hour day. 

MR. CORNFORD: Yes, sir. 

CHAIRMAN LOCKYER: What were the circumstances in which 
petitions or discussion came before the Commission and your own 
ideas about that? 

MR. CORNFORD: As you probably are aware. Senator, the 
initial request came to the Commission from the Governor's 
Office, asking us to examine whether or not the eight-hour day 
was in the welfare of the working people of the state. 

As a result of that request, meetings were held in five 
various cities throughout the state, and endless hours of 
testimony, and large numbers of people had an opportunity to 
testify. 

As a result of those five hearings, and an analysis of 
the piles of written testimony that we received, the Commission 
voted, and it was an unanimous vote of all members of the 
Commission, to only open five of the fifteen wage orders, and to 
keep the other ten orders closed, and keep the current rules 
intact relative to the eight-hour day. 

CHAIRMAN LOCKYER: What were the five? 

MR. CORNFORD: The five are Order Number One, which is 
manufacturing; Order Number Four, which is professional and 
clerical, and kind of an umbrella for all the orders that are 
not put somewhere else. Five is the public housekeeping. Seven 



is mercantile, and Nine is transportation. 

CHAIRMAN LOCKYER: You have a good memory. Could you 
tell us what the other ten were, if we asked? 

MR. CORNFORD: Yes. 

CHAIRMAN LOCKYER: Have you got a list there? Why 
don't you mention them just so we know what they are? 

MR. CORNFORD: The ones that I was particularly 
concerned about, and one that I felt could not be justified, are 
Orders, I think. Ten and Twelve, dealing with the motion picture 
and television industry, where I was convinced that the 
testimony didn't support changing the rules in those 
industries. 

The reason there is that an employee in those 
industries may well work for two or three employers in a given 
work week, and therefore, they would never have a chance to work 
a forty-hour work week for one employer, so it was not 
appropriate. 

CHAIRMAN LOCKYER: Are those two different segments, 
movies and t.v.? 

MR. CORNFORD: Order Number Ten is broadcast industry, 
radio or t.v. broadcasting. Order Twelve is motion picture 
industry, so they are divided, yes, sir. 

CHAIRMAN LOCKYER: Now, what would happen with respect 
to the five that you mentioned? What is the process? 

MR. CORNFORD: The process is that the Commission is 
currently attempting to draw up a charge to the Wage Boards, and 
there will be a Wage Board at this point for each of those 
five. And we are asking them to study creative alternatives to 



the rigidity of the current rule, that the only rule you can 
have is one of two options, basically, either the eight-hour 
day, or through a very complex procedure, you can have a 
ten-hour work day, and to examine that. 

They are also on three orders — One, Four and Five — 
asking to look at a conflict between the state and federal 
government on the interpretation of administrative and executive 
exemptions. It's a technical kind of thing, 

CHAIRMAN LOCKYER: I guess I'll shift you for a moment 
on to minimum wage. 

MR. CORNFORD: Yes, sir. 

CHAIRMAN LOCKYER: We've had copies of the discussions 
from hearings. 

Did it ever go to a vote while you were there? 

MR. CORNFORD: We voted unanimously to send the matter 
to a Wage Board. We are awaiting the written results of that 
Wage Board, which have not yet come back to the 
Commission. 

CHAIRMAN LOCKYER: How long does that normally take? 

MR. CORNFORD: It's my understanding that that report 
was supposed to be due here on the 28th of this month, but I 
have not yet seen it. Senator. 

CHAIRMAN LOCKYER: Then you vote on adopting or 
changing that report? 

MR. CORNFORD: Or conducting additional investigation. 

CHAIRMAN LOCKYER: So, you're not bound by it? 

MR. CORNFORD: Unless it's a two-thirds vote of the 
Wage Board, that is correct. 



CHAIRMAN LOCKYER: If that happens — 

MR. CORNFORD: Then it's my understanding the 
Commission is then bound by the action of the Wage Board. 

CHAIRMAN LOCKYER: The Wage Boards, though, are pretty 
evenly balanced? 

MR. CORNFORD: In this case, they were ten and ten. 

CHAIRMAN LOCKYER: So, a two-thirds vote is sort of a 
rarity. Sounds like it might be? 

MR. CORNFORD: Possibility. 

CHAIRMAN LOCKYER: On some of the issues. 

Are there other questions from Members? 

Are there people who wish to comment and provide, 
first, supportive testimony? 

MR. ABRAMS: Good afternoon. Thank you, Mr. Chairman, 
Members of the Committee. 

My name is Jim Abrams. I'm the Executive Vice 
President of the California Hotel and Motel Association. I'm 
also appearing here on behalf California Lodging Industry 
Association. 

I've had the pleasure of working with Mr. Cornford for 
approximately 20 years in a variety of different capacities 
involving not only the hospitality and lodging industry, but 
other industries as well. 

When his name was put forward for the Industrial 
Welfare Commission, we whole-heartedly supported his nomination 
for several reasons. 

One, we have found over the years that, in many cases, 
people on the Industrial Welfare Commission don't have the 



8 

day-in and day-out experience on the practical kinds of problems 
that confront the Division of Labor Standards Enforcement, 
employers, and employees constantly. Unless someone has spent a 
great deal of time and in a wide variety of circumstances 
involved in those kinds of problems, there really is a learning 
curve that is almost never met. 

Mr. Cornford has done pretty much that exactly for 
three decades, plus he's extremely knowledgeable not only with 
respect to the hospitality industry, but with a wide range of 
industries covered by the Industrial Welfare Commission. 

Also, it's something that's sometimes unusual, 
Mr. Cornford is a very practical man. A lot of times, we have 
found that people quite often on various boards and commissions 
follow a particular ideological point of view and don't always 
think through what the consequences are going to be on a 
practical, day-in and day-out basis. 

Mr. Cornford has worked with employers and employees, 
and his goal has always been to make the relationship work. And 
quite often, that requires that sometimes everybody has got to 
give something so that the end result is one that's practical 
and that will work for everybody, and that's another attribute 
that we particularly appreciated in Mr. Cornford. 

We would whole-heartedly support his appointment to the 
Industrial Welfare Commission. He has been there now almost one 
year. He has been very diligent, very hard-working. I know 
personally that he takes his responsibilities at the IWC very, 
very seriously. I think he would be a tremendous asset to the 
Industrial Welfare Commission. 



Thank you. 

CHAIRMAN LOCKYER: Thank you very much. 

Other comments. 

If there are ever questions, please just interrupt. 

Yes. 

MS. BROYLES: Good afternoon, Mr. Chairman, Members. 

I'm Julianne Broyles from the California Chamber of 
Commerce. 

We also endorse Mr. Cornford's re-appointment to the 
Industrial Welfare Commission. 

We also have enjoyed working with Mr. Cornford over the 
last eleven months in the Industrial Welfare Commission 
meetings. He has been always a member who has been present, has 
taken his duties very, very seriously as being a fair and equal 
listener to all sides. I can't think of any situation in the 
last eleven months where I have been present in the meetings 
where he hasn't gone out of his way to favor one side over 
another, and his balanced approach to all of this has been very, 
very refreshing. 

We hope that Members of the Committee will look at his 
appointment as a member of the Industrial Welfare Commission 
favorably. We would like to continue to work with him, if it so 
pleases the Committee, and would like to urge your aye vote. 

Thank you. 

CHAIRMAN LOCKYER: Mr. Washington. 

MR. WASHINGTON: Good afternoon, Mr. Chairman, Members. 

Willie Washington with the California Manufacturers 
Association. 



10 

I think in the ten years that I've been here, this is 
the one issue that I've pursued the ten years that I have been 
working for the California Manufacturers Association. And as 
many of you know, I come from the employment area and worked as 
a professional in human resources for many, many years before I 
took on this job. 

CHAIRMAN LOCKYER: What company were you with? 

MR. WASHINGTON: I worked for Pittsburg-DesMoines 
Steel/ both fabrication and construction. 

Mr. Cornford is the first member that I've been able to 
support. He comes to this particular Commission with the type 
of background that is so very well suited for this type of 
work. And I've had a great deal of pleasure of having an 
opportunity to work with him since he was appointed some eleven 
months ago. 

In addition to what you've heard already, that he is 
indeed a highly respected consultant who has worked both in the 
industry and then as consultant with the industry, I've also 
found Mr. Cornford to be a person who's very easy to talk with. 

More importantly than just my talking with him is, in 
the last eleven months, I've attended every hearing that the 
Commission has conducted relative to the daily overtime issue. 
As you know, that is my number one priority, and I just wouldn't 
miss one of those hearings for nothing. 

The fact of the matter is that these meetings have gone 
on rather long. I mean, they have been all day, going way beyond 
the time that they were advertised by the Commission. And to 
that I would say that the Commission members have been very. 



11 

very receptive to trying to take the testimony and listen to the 
individuals. 

I've observed on several occasions where there were 
members there who were somewhat opposed to the mere fact that 
either daily overtime, or the minimum wage, any of those items 
were even being discussed, and were somewhat harsh in their 
criticism of the Commission. And I'm pleased to say that on 
each of these occasions, I've observed that Mr. Cornford has 
continued to treat those folks with very high respect and 
regard, and continued to keep an open ear to hear their 
concerns. 

On many, many occasions when I've been there, there's 
been a considerable number of employer representatives there in 
support of some of these issues, and I'm certainly one of them, 
trying to get my members out to support the goal of trying to 
make some changes in California law that would accommodate some 
of the changes that we think is needed. 

But on many occasions, labor are there in major, major 
numbers. And I have to say that to sit through these sessions 
all day, when some of the testimony becomes pretty redundant, 
I'm sure would remind you of some of the hearings you've sat 
through up here. 

CHAIRMAN LOCKYER: Not this one yet. 

MR. WASHINGTON: In any event, I've seen him do that. 

And so, I would say that certainly Mr. Cornford is very 
well suited for that. I think he's been very fair and open with 
those folks who come before him, including will Willie 
Washington. 



12 

We would like very much to see him continue. We would 
like to see this job get done. It's been a long time coming, 
and we need to get a vote. We need to get this down here so 
that we can have a fair discussion and get these boards 
appointed so we can move on with it. 

And I'd like to urge you to vote for the confirmation. 

CHAIRMAN LOCKYER: Thank you. Were there other 
supporters that wanted to comments? 

SENATOR PETRIS: May I ask a question. 

Those long, long meetings are rather common that you 
referred to? 

MR. WASHINGTON: It is when we have an issue. Senator 
Petris, where there is an issue that affects labor directly, as 
these issues do, and ones where the employer community is also 
affected, and of such importance as these are to us. And when I 
say "us", I'm speaking of the manufacturers. 

SENATOR PETRIS: The Commissioners are paid a flat fee 
of $100 dollars per meeting? 

MR. WASHINGTON: My understanding is that $100. 

SENATOR PETRIS: Regardless of how long the meeting 
goes? 

MR. WASHINGTON: That's correct, sir. 

SENATOR PETRIS: There's no overtime pay? 

MR. WASHINGTON: Not at all. 

SENATOR PETRIS: Thank you. 

SENATOR AYALA: On that point, Mr. Chairman. 

With all the testimony that the gentleman's been 
exposed to, long hearings on the different issues, I was 



13 

surprised when he told me last week that he hadn't made up his 
mind on minimum wage. 

How long does it take to make up someone's mind when it 
comes to minimum wage and the prevailing wages? I mean, after 
how many years you've been having these hearings, he still 
hasn't made of his mind, so I was a little bit surprised. He 
may be a good listener, but he doesn't act accordingly. 

MR. WASHINGTON: Senator Ayala, was that addressed to 
me? I don't want to presume to speak for — 

SENATOR AYALA: It was addressed at you because you're 
the one that brought up the fact that he sat down through 
hearings after hearings after hearings, and obviously they 
didn't take, because he wasn't sure what he was going to do with 
the minimum wage a week ago. 

MR. WASHINGTON: Senator, I think that that goes along 
with the fact that this is my tenth year up here, and I'm still 
working on some of these issues. That this is a very, very 
laborious procedure. 

The IWC, whether it's minimum wage or looking at daily 
overtime, the law requires so many hurdles be jumped over, i.e., 
the notices that you have to give, the time that you have to 
bring people together. The information has to be gathered, 
sorted through. You have to draw some type of analysis with it. 
You have to write up something else, go back to the public. 

The period of time that it takes to go through this 
process, regardless of whether it's daily overtime or minimum 
wage, is very, very lengthy. There's nothing that can be done 
with them in a very short period of time. 



14 

1 SENATOR AYALA: You've been ten years with the Chamber? 

2 MR. WASHINGTON: With the Manufacturers Association. 

3 SENATOR AYALA: Are you still making same amount you 

4 did ten years ago? 

5 MR. WASHINGTON: No. 

6 CHAIRMAN LOCKYER: Mr. Comford, you know from the file 

7 that there is a rather substantial amount of opposition to 

8 confirmation brought by the labor community? 

9 MR. CORNFORD: I've heard that, sir. 

10 CHAIRMAN LOCKYER: Do you want to comment or offer any 

11 sort of explanation before we hear them? You can wait if you 

12 want to hear their comments, but what you think that's all 

13 about? 

14 MR. CORNFORD: I would prefer to wait, if I might. 

15 CHAIRMAN LOCKYER: Fine. 

16 Comments from opponents? 

17 MR. RANKIN: Good afternoon, Mr. Chairman, Senators. 

18 Tom Rankin with the California Labor Federation. 

19 A little background, since Mr. Cornford gave you a 

20 little. I'd like to give you a little from our perspective. 

21 In 1914, when Hiram Johnson was the progressive 

22 Governor of California, the Constitution of California was 

23 amended to give the Legislature authority to deal with minimum 

24 wages for women and minors, and to deal with the comfort, 

25 safety, and health of all workers, and general welfare of all 

26 workers. 

27 Then it also said that the Legislature could delegate 

28 these responsibilities to a commission. And it did and set up 



■ 15 

the Industrial Welfare Commission. 

And the Commission is made up of five members: two 
labor, two employers, and one public member. The idea was that 
this body would somehow balance each other off and would carry 
out the duty that the Legislature — that the Constitution gave 
the Legislature to protect the interests of the employees. It 
was meant as a protective body for employees. 

Well/ what's happened, unfortunately, in recent years, 
it's become a threat to employees. It's become a body that 
attacks employee rights in terms of hours and working 
conditions, and does nothing on the minimum wage, even though 
its duty is to provide for a minimum wage that is adequate to 
give people the necessary cost of proper living. It hasn't 
acted since 1987 in that manner. 

Also, in terms of hours and working conditions, its 
duty is to make sure that those hours and working conditions 
that exist are not prejudicial to the health and welfare of 
employees. Those are in statute. 

So, what's happened recently is, as I said, it's become 
an attack dog on workers. And what we have on the Commission 
now that's appointed by the Governor are two employer members, 
both of whom are closely connected with industries that tend to 
lose the most with an increase in the minimum wage — 
agriculture and the hotel and restaurant industry, a public 
member from academia, and two labor members who have no 
connection with minimum wage employees at all, one from the 
building trades, and one from the public sector, a recent 
appointee who's a state engineer. Neither the construction 



16 

trades nor the public sector are even covered by the Industrial 
Welfare Commission. So, what you have is a totally unbalanced 
IWC in terms of representation. 

In terms of employer representatives, we expect them to 
come with a certain perspective, of course, as we do labor 
people. But we also expect them to comply with the mandates of 
the law, the extraordinary mandates. 

Mr. Cornford, before he was appointed Commissioner, sat 
on one of these minimum wage boards in 1993. He was the most 
vocal spokesman for the employers against an increase in the 
minimum wage in 1993 on that wage board, and as a matter of 
fact, he made a motion that the state should never have an 
increase in the minimum wage above the federal. 

In that case, why have the IWC? There's no point in it 
if all we're going to do is have the same minimum wages as is 
mandated by Congress. 

He used the time-worn argument that it was going to be 
bad for competitiveness of the State of California, that people 
are going to lose jobs. These arguments have been disproven by 
several economic studies. 

And his posture in the hearings that the IWC recently 
had, before it set up the Wage Board on the minimum wage, didn't 
show any change from that. There was no indication of any 
sympathy on his part towards increasing the minimum wage as a 
Commissioner. 

I might add that he neglected to mention to you that 
this Wage Board that was set up deadlocked, as all the Wage 
Boards have done in the last several years except one in 



17 

manufacturing that had to do with hours, and I want to talk 
about that in a minute. So, if the Wage Board's deadlocked, 
it's thrown back to the IWC to make a decision. 

He also indicated his hostility to the interests of 
working people in another vote which he didn't mention, which 
was a vote on an issue to eliminate the IWC requirement that 
workers employed in the almond processing industry, where they 
work 12-hour days, not have a mandatory day off once a week. In 
other words, he thinks it's fine that people work 84 hours in a 
row without a day off. 

He voted, to be sure, to establish a Wage Board for the 
minimum wage. He also voted to establish a Wage Board, which he 
mentioned covers only five wage orders. Those wage orders cover 
the bulk of the employees in the state of California, those five 
wage orders that he mentioned, where the goal of the Governor is 
to eliminate daily overtime. And he has told that to the public 
and to the IWC. 

Going back to the manufacturing wage order, that was 
one instance in all the years that I've followed the IWC, which 
are considerably more than ten, where the labor members of the 
Wage Board and the employer members reached an agreement, 
unanimous. They all agreed that, in addition to the ten-hour 
day that was allowed by the wage orders, that employers could 
work out other combinations under ten hours. For instance, four 
9-hour days and a 4-hour day. That was agreed on unanimously by 
the representatives on the Wage Board, adopted by the IWC. Now, 
of course, the Governor wants to undo that. 

It was also not mentioned by Mr. Cornford that the IWC 



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18 

has already acted in four instances to allow 12-hour days in 
California without overtime. To be sure, where they could do 
12-hour days and 10-hour days, there are procedures that have to 
be followed and employees have to vote on whether or not they 
want that increased work week. 

We don't even think those procedures are very 
protective, because the employer runs the election, the employer 
can meet with the employees. It's not a very fair procedure, 
but anyway, there is some protection. 

What the Governor clearly wants to do is to get rid of 
this altogether and to go with a 40-hour week. In other words, 
to do away with daily overtime altogether. 

In summary, we have had no indication that Mr. Cornford 
has changed his position since he was on that Wage Board, on the 
Minimum Wage Board. No indication that he can transcend the 
role as a pure employer representative, and comply with the 
statutory mandates, and give people a long overdue increase in 
the minimum wage, and protect workers who want and need their 
daily overtime. 

The daily overtime issue simply involves, if they do 
away with daily overtime, it's simply a transfer millions and 
millions of dollars from the pockets of employees to the pockets 
of employers. It has nothing to do with flexibility. 

CHAIRMAN LOCKYER: Okay, thank you. Questions. 

Are there others who wish to comment? 

SENATOR PETRIS: I have a question. 

If what you consider appropriate action had been taken 
on the minimum wage over the years, I understand the current 



19 

amount would be seven dollars and something? 

MR. RANKIN: Over seven dollars, yes. 

SENATOR PETRIS: Over seven dollars an hour? 

MR. RANKIN: Part of the problem is that the Industrial 
Welfare Commission has simply been a tool of the employers in 
the amount of the minimum wage. Had it increased the minimum 
wage gradually every year to keep up with inflation, we wouldn't 
be in the same position we are now. Now, to get it up there, 
and you know we're sponsoring an initiative only to bring it to 
5.75 in two years, because it would simply be too big a shock to 
go to 7.25, or whatever it should be. 

But if they had taken their responsibilities seriously, 
instead of just being the voice of the employers, and raised it 
gradually every year, the employers would be a lot better off 
and the workers would be a lot better off. But they've chosen 
not to do and to become simply a mouthpiece for the employers. 

SENATOR PETRIS: May I ask Mr. Cornford, does this 
mean that you and a majority of the Board members just don't 
want to raise it, period, since it hasn't been addressed for a 
long time? 

MR. CORNFORD: No. 

SENATOR PETRIS: Does it mean that you think that the 
current amount is adequate? 

MR. CORNFORD: No. I voted. Senator, that the minimum 
wage may not be adequate, and that's why we referred it to a 
Minimum Wage Board. 

SENATOR PETRIS: What's the status of that now? 

MR. CORNFORD: We're waiting for the report to come 



20 

back from the Minimum Wage Board. 

SENATOR PETRIS: That'll be a recommendation to you, I 
suppose? 

MR. CORNFORD: It will be a series of votes on various 
issues relative to the minimum wage, yes. 

SENATOR PETRIS: But it has no effect unless the IWC 
adopts it? 

MR. CORNFORD: That is correct, unless it's two-thirds. 

SENATOR PETRIS: How many are on that? 

MR. CORNFORD: On which. 

SENATOR PETRIS: On the IWC? 

MR. CORNFORD: Five. There are two labor appointees — 

SENATOR PETRIS: Two from each side? 

MR. CORNFORD: And the public member. . 

SENATOR PETRIS: . Thank you. 

SENATOR BEVERLY: May I clarify something? 

The only vote you cast on minimum wage is the vote to 
refer it to the Wage Board? 

MR. CORNFORD: That is correct; it's the only vote. 

CHAIRMAN LOCKYER: Reference was made to prior service 
on a previously ordered wage study — 

MR. CORNFORD: Right. 

CHAIRMAN LOCKYER: — of minimum wage. I guess you 
were representing hotel employers? 

MR. CORNFORD: I was representing various employers. 
There were ten people on the employers' side, and I was one of 
those ten. 

It is quite correct that I did offer certain motions as 



21 

an advocate for the employer community at that time. 

I wish to draw a distinction, however, between the 
service on the Commission, which I think may well have a higher 
standard than being an advocate on a Minimum Wage Board. 
Certainly Mr. Rankin knows that. He was an advocate on the 
other side of the table, and he took some opposing positions. 
Unfortunately, we weren't able to view the matter in the same 
light. 

CHAIRMAN LOCKYER: You mentioned early in your comment 
that you certainly don't consider yourself a rubber stamp of the 
administration or their points of view. 

I would think almost everyone would feel that way. 
What's the point of having developed some expertise if you're 
not entitled to your own view? 

Can you point to any issues that have come up during 
your tenure on the Board that you would say indicate a vote that 
might be at odds with the general philosophy of the 
administration? 

MR. CORNFORD: Well, let me address it this way, if I 
can. It is my independence, I think, that is really at issue 
here. And I did comment that I don't feel I'm a rubber stamp. 

It may well be, and I don't know the mind of the 
Governor on this, but it may well be that the Governor would 
just as soon not have this issue of minimum wage go to a Wage 
Board, but I voted, along with the other members, and it was 
unanimous. The labor member, there was one vacant seat, and the 
public also voted for that. 

CHAIRMAN LOCKYER: What we've seen in the past is, it 



22 

was a device to just stall. Tlnd so, it was a way to postpone, 
and then, when the Wage Board came back and even suggested some 
increases, it was turned down. 

MR. CORNFORD: With all due respect. Senator, I would 
respectfully disagree. I did not view it as a stalling tactic. 
I have felt it was an essential part of the process in getting 
all the available information back before the Commission. 

In fact, I personally believe that the Commission would 
have been subject to criticism if it had not called a Wage 
Board. 

CHAIRM7\N LOCKYER: I don't think I can disagree with 
that. It's just the weight given to their recommendations seems 
sometimes to not be too persuasive. 

No other issues that come to mind? . 

MR. CORNFORD: The other, it's obviously this issue of 
the overtime issue. And one of the things — 

CHAIRMAN LOCKYER: You mean scaling down fifteen to 
five? 

MR. CORNFORD: I have to tell you, the reason why I 
voted to open five of the wage orders is that there was an awful 
lot of testimony presented from employees who said, "Under the 
current rules, we are — our lives are negatively impacted." 
We don't have, even though Mr. Rankin may disagree and wish to 
negate it, is that they wish to have more flexibility. Let me 
give you an example. 

An employee wishes to take a couple of hours off one 
day and add it to the next day. Can't very well do it without 
the payment of overtime. And employees in large numbers 



23 

supported the flexibility. 

One of the things that I did say when we were 
deliberating on this issue, I said, "We have got to be creative 
in this state. We are not in a situation any longer where one 
rule fits all employees in the state. We're too diverse, we're 
too complex." 

I have advocated, and will continue to advocate on the 
charge to the Wage Board, that these Wage Boards be creative. 
Now, creative in terms of allowing flexibility to come up with 
some new approaches, but also in terms of — and if you'll read 
the minutes — protection for the employees. I believe that 
protection is an absolute necessity, to make sure that no one is 
taken advantage of. I strongly believe that. 

CHAIRMAN LOCKYER: No day off for almond processing? 

MR. CORNFORD: I did not sit in on every hearing of 
that because the way the appointment fell, but I came in for a 
couple of hearings. 

My understanding from the testimony is that there were 
employees who wanted this opportunity to work an additional day, 
or seven days, because of the short seasonal nature of this 
industry. They have to do it when the product is there, 
otherwise it spoils. So, they wanted to. They wanted to 
maximize their earnings during a short period of time. 

Secondly, it is voluntary. There is no force that is 
going to be exercised. I was convinced of that. And I tell you 
why I felt that way. 

More than one employer said there is a shortage of 
qualified employees to do this work. It's highly specialized. 



24 

and there's not very many people who can transfer their skills 
to this kind of process. We're not going to abuse our 
employees . 

I have to give some faith and credit to the employers 
that said that. I did not hear any testimony from employees 
saying that they had been abused, or somehow forced to do 
something that they did not wish to do. 

CHAIRMAN LOCKYER: What is the current process? What's 
the law with respect to employees assenting to a change in 
scheduling? How does that work? 

MR. CORNFORD: It would have to be, in this situation, 
it would have to be by written authorization that can be 
revoked. 

CHAIRMAN LOCKYER: No, I'm sorry. Just as a general 
matter, there's some way in which employees can work with the 
employer and vote, or something, to have a change in hours. 
What are the details? 

MR. CORNFORD: For example, right now in a particular 
work unit, the employees have to, by a two-thirds vote, assent 
to changing their work schedule. 

CHAIRMAN LOCKYER: So it would be a unit? It couldn't 
be the whole company? 

MR. CORNFORD: It depends on how you define this 
particular work unit. 

But what is interesting. Senator, is that if that 
employer were subject to a collective bargaining agreement, you 
can, by a simple majority, change the work schedule of 
employees. So, it seems as if the playing field is slightly not 



25 

equal in this situation. Where, in a nonunion situation, you 
have to have two- thirds; in a union situation, it's a majority 
of whoever votes. 

I'm sure Mr. Rankin knows — . 

MR. RANKIN: And union — 

MR. CORNFORD: If I might. 

It's that not all 100 percent of employees always vote 
in elections. 

CHAIRM7\N LOCKYER: Two-thirds of all employees? 

MR. CORNFORD: Two-thirds of all the employees. 

CHAIRMAN LOCKYER: Not just two-thirds of those voting? 

MR. CORNFORD: That is my understanding. 

CHAIRMAN LOCKYER: Plus whatever the unions, okay. 

MR. RANKIN: The employer sets, determines the unit 
that votes. They can say, "These five people over here are a 
unit. They get to vote." 

The employer holds the election and counts the 
ballots. And that is a fair election? Don't compare that to 
union situations. 

CHAIRMAN LOCKYER: Well, a two-thirds vote, is that a 
correct representation? 

MR. RANKIN: Two- thirds vote. 

CHAIRMAN LOCKYER: I guess maybe the difference is 
meant to be an inducement to organize, if people want to, to 
find ways around those two-thirds vote requirements. 

Any other questions for Mr. Rankin or Mr. Cornford? 

SENATOR PETRI S: Just Mr. Cornford. 

I'm trying to get a handle on just how you see this 



26 

1 mission that you're in. We often ask people if they've read the 

2 statute to know what your charge is. 

3 I guess you've done that? 

4 MR. CORNFORD: Yes, sir. 

5 SENATOR PETRIS: Under the IWC, their duties include 

6 ensuring, this is a direct quote, "fair treatment of employees, 

7 especially the working poor, and fair conditions of competition 

8 for employers who treat their employees humanely." 

9 There's a side benefit to that, in that it's for 

10 society as a whole. 

11 MR. CORNFORD: Right. 

12 SENATOR PETRIS: If people are paid better, you know, 

13 they live better, they're less likely to go on the public 

14 assistance rolls, and so forth. 

15 I remember when. I first got interested in the plight of 

16 farmworkers a long time ago, we had a report from the 

17 Legislative TVnalyst's Office that checks out things for the 

18 Legislature, and the one that really sticks in my mind, the 

19 Analyst started one report by saying, "If you want to get hurt 

20 on the job, or you want to get sick on the job because of the 

21 conditions there, be a farmworker." 

22 And that actually triggered my interest in pesticides, 

23 and I've carried legislation on that. 

24 And I see here some information given us, a survey by 

25 the National Institute of Occupational Safety and Health, there 

26 were 210,594 lost work days in '93 due to disabling 

27 injuries. There's not any detail behind that, but it does say 

28 that prominent among the occupational illnesses and injuries 



27 

suffered by farmworkers are the hundreds of pesticide poisonings 
that occur each year. 

And your group, were you on it in September of last 
year? 

MR. CORNFORD: Yes, sir. 

SENATOR PETRIS: They had a meeting in Fresno to have 
some testimony on that problem. And there was an exchange 
reported here between one of the labor representatives that was 
kind of dramatic. 

I'm wondering what your understanding now is of the 
difficulties of being a farmworker in California/ particularly 
in some fields, some areas, and whether you have any ideas for 
improving the plight of the farmworkers' conditions? 

MR. CORNFORD: That issue hasn't come — the plight of 
the farmworker in the sense that you're describing it, has not 
come before the Industrial Welfare Commission. It's probably 
more properly before the Occupational Safety and Health group. 

But, Senator, I'm concerned about any employee in the 
State of California and about their welfare. Farm work is hard 
labor, no doubt about it. 

SENATOR PETRIS: I don't think they complain so much 
about the hard labor as they do about the conditions surrounding 
the work. We all know that what they call "stoop labor" is very 
hard, especially in certain parts of the year, depending on the 
climate and so forth. 

There was an exchange between you and Mr. Perez, 
representing the farmworkers, who says that, "We, the 
farmworkers, many times feel we're treated as animals, no 



28 

1 dignity, and worth nothing. And we're the ones that raise the 

2 crops and the raisins. Daily we eat dirt. We finish working 10 

3 hours. We end up spitting dirt just to win a minimum wage." 

4 I encountered statements like that a long, long time 

5 ago when I first got into this field. Here we have Mr. Perez in 

6 September of last year repeating the same complaints, and he 

7 goes on to point out that all he's seeking is justice for all. 

8 They don't see the justice of where they live or where they 

9 work. 

10 I remember one of the hearings that we had when I was 

11 more active in San Diego County, not far from the city. The 

12 farmworkers were living in holes in the ground. I don't know 

13 why it would have to take a public hearing by a legislative body 

14 to investigate that and ask the employer, "What the in the world 

15 are you doing here? What possible justification can you have?" 

16 They'd pull a corrugated tin slab over the hole. 

17 That's where they lived. 

18 Now, fortunately, that's not a common practice 

19 throughout the state, but to encounter it even in one area on 

2 one farm or two in the area, to me, was very, very shocking, and 

21 I found it very repulsive. 

22 So, that's why, you know, some of us are concerned 

23 because farmworkers have had a very bad history in this state in 

24 their treatment. I know they've improved it a lot, but I'm told 

25 they still have a long way to go. 

2 6 Are you being apprised of these kind of conditions in 

27 your capacity on the Welfare Commission when you make decisions 

28 on wages, and hours, and so forth? 



29 

MR. CORNFORD: With regards to the farmworkers/ 
Senator? 

SENATOR PETRIS: Yes. 

MR. CORNFORD: We have received, as you mentioned, 
certain comments by various representatives from the 
farmworkers, particularly when we were in San Diego. We had a 
large number, and we had in Fresno also, yes. 

SENATOR PETRIS: What's your reaction? 

MR. CORNFORD: I think it's a travesty that any person 
would have to live in a hole in the ground or live in sub-human 
conditions. I would not tolerate that. 

SENATOR PETRIS: Hopefully, it isn't happening now, but 
it was at the time I was looking into it. 

Well, suppose it came to your attention. What would 
you do? Suppose it were happening now. 

MR. CORNFORD: If it came to my attention as a member 
properly before the Industrial Welfare Commission, I would 
believe that then we have an obligation to conduct an 
investigation as to the validity of those comments. 

SENATOR PETRIS: And if they were valid? 

MR. CORNFORD: We would have to act accordingly to try 
to eliminate that type of situation, if it is properly within 
the purview of the Industrial Welfare Commission. 

SENATOR PETRIS: Do you know whether it is or not, or 
do you only look at wages? 

MR. CORNFORD: No, there's other conditions of 
employment, but some of those are pre-empted by other statutes. 

SENATOR PETRIS: This statement is a little bit 



30 

lengthy, but I mentioned justice, they were looking for justice, 
and the labor representative says, "We don't see justice where I 
live, where I work. Sometimes they don't even give us water. 
We do the work because necessity dictates what we have to do." 

It seems to me that would be enough reason to go in 
there and demand an explanation from whoever 's responsible for 
that. 

I heard that same complaint a long time ago. I just 
have a bad taste in my mouth for the attitude that employers 
have, some employers, in some parts of the state. 

It took me many, many years to get my first farm labor 
bill passed. And when it passed, I wasn't even the author 
anymore. Someone else picked it up. And that was a bill that 
required posting in the fields after they were sprayed with 
poison. If you spray the^ field with poison, people around don't 
know. Employees, in particular, are not informed as to the 
nature of the poison. So I said, "Post a notice and explain the 
clearing time. This field has been sprayed with poison on 
such-and-such a day and time. No admission until the clearing 
time is passed, such-and-such a time later today, or tomorrow, 
or the next day." Most of them passed within a few hours, or 
certainly two or three days. 

The chemical companies and the growers fought against 
that as if I had a bill to nationalize the industry and take 
everything away from them. I couldn't believe how tenacious 
they were in their opposition. Some of them viewed it as, well, 
it's the opening salvo, and it's the camel under the tent thing, 
who knows what he's going to do next. 



31 

I was a city boy, and I found these kind of conditions 
equal to Medieval days. 

So now, today, if I get even a small complaint, it 
still bothers me. I'm wondering to what extent you're made 
aware of these things, and to what extent the Commissioners go 
out and visit some of the properties to see what the conditions 
are? 

MR. CORNFORD: The comments that were made by Mr. 
Perez, I believe, were in the context of the minimum wage 
hearings, as I recall. Certainly, Mr. Perez may well have some 
valid points, and I do think that that needs to be further 
investigated. 

The fact that we haven't done anything probably is — 
or I have not done anything is strictly a factor that we've been 
involved in the minimum wage and the overtime issues, and have 
not had time to get into some of these other areas. 

SENATOR PETRIS: Do you have staff? 

MR. CORNFORD: No, sir, I don't. 

SENATOR PETRIS: Does the Commission itself have staff? 

MR. CORNFORD: The Commission has a very limited staff 
of, I think, three people. 

SENATOR PETRIS: Is it kept that way on purpose? 

MR. CORNFORD: I don't know, sir. 

SENATOR PETRIS: Have you ever asked for more staff? 

MR. CORNFORD: I'm too new to the Commission at this 
point in time to understand all of the ramifications of the 
budgeting process here in Sacramento. 

But do we need additional staff? Yes, sir, we do. 



32 

1 SENATOR PETRIS: If you had additional staff, how would 

2 you use them? 

3 MR. CORNFORD: I think that comments such as Mr. Perez 

4 makes would make sufficient fodder to go out and look. 

5 SENATOR PETRIS: Investigate the conditions — 

6 MR. CORNFORD: Yes, sir. 

7 SENATOR PETRIS: ~ in the fields? 

8 MR. CORNFORD: Absolutely. 

9 SENATOR PETRIS: Well, did you have reason to 

10 disbelieve Mr. Perez when he made that statement? 

11 MR. CORNFORD: I'm not an expert in agriculture. The 

12 Chairperson of the Commission is an agricultural expert. And as 

13 I recall, she was concerned about the comments, and she talked 

14 from her own personal experience about her own employees, and 

15 how they do care about their staff and their employees. 

16 But that if people — as I recall, if people were 

17 violating the laws, then they should be prosecuted. 

18 CHAIRMAN LOCKYER: Let me give you, if I may, just 

19 another example, not meaning to prolong this debate, but it goes 

20 back to early years. 

21 I was conducting a hearing in Fresno. There were, I 

22 would think, maybe a couple hundred growers and others in the 

23 hearing room. One of the gentlemen got up and said, "Hey, we 

24 used to be able to kill these bastards. Now we can't even fire 

25 them," in front of a room full of people who thought it was 

26 pretty funny. 

27 MR. CORNFORD: I don't think that's funny. 

28 CHAIRMAN LOCKYER: I'm not suggesting that you're 



33 

countenancing that attitude at all, but it just shows something 
about the sort of semi-feudal tradition that we've allowed in 
this state. 

MR. CORNFORD: Hopefully, that's changing. 

CHAIRMAN LOCKYER: It is changing. There's no doubt 
about that . 

Are there other questions? Yes, Senator Ayala. 

SENATOR AYALA: Tell me again the process for 
considering a wage change, minimum wage. How did that go from 
your committee. 

MR. CORNFORD: I'm sorry, the Commission voted 
unanimously to call for a Wage Board. 

SENATOR AYALA: For a minimum wage? 

MR. CORNFORD: To study further the issue of a minimum 
wage increase. 

SENATOR AYALA: Why is it so difficult? Here are 
people who haven't had a raise in eight years. There's no one 
in this room that hasn't had a raise in eight years. Their cost 
of living's gone up. 

What does it take, a rocket scientist to come up with a 
conclusion of that? Why couldn't you people do it right there 
in the Commission? 

MR. CORNFORD: Again, Senator, as I stated earlier to 
you. Chairman Lockyer, I think the Commission would have been 
severely criticized if we had not called a Wage Board. 

SENATOR AYALA: By whom? 

MR. CORNFORD: I think the general public could 
criticize us. 



34 

SENATOR AYALA: I disagree with that. 

How can you tell me that someone who's making $4.25 an 
hour, haven't had a raise in eight years, the cost of living's 
going up, and yet, you put it to a commission to study it? Why 
does it take -- it's not that complicated. 

MR. CORNFORD: Again, Senator as I understand it, it is 
written into the process. It is part of the procedure that if, 
in fact, the Commission feels that the minimum wage may not be 
adequate, we call for a Wage Board. 

SENATOR AYALA: You can't act on your own? 

MR. CORNFORD: As I understand it, before we act on our 
own, we need to call a Wage Board. That is my understanding. 
Senator. 

CHAIRMAN LOCKYER: Are there others that wish to 
comment? 

MR. WATSON: My name is Don Watson. I'm representing 
the International Longshoremen's and Warehousemen's Union. 

In recent years, we have been pretty down on the kind 
of trend that is coming to the Industrial Welfare Commission, 
which we've always seen as having a primary job of protecting 
working people. And I think that some of the purposes have been 
lost. 

We in the ILWU have been involved in trying to organize 
nut workers. We've had activity down in the Valley, and so 
we're familiar with — the nut growers have been for the last, 
well, for about a decade, every year they have said that they 
wanted a special exemption. And so, year in and year out, 
they've gotten the exemption from the overtime rules so they can 



35 

work the workers 84 hours a week. 

And SO/ and actually getting these exemptions was to 
only be, like, temporary until something could be worked out, 
some kind of a formula could be worked out. But then, the IWC 
decided to make this whole thing permanent. 

As far as the workers, whether they want to do this, 
it's a fact that they're nonunion workers, and that they're 
immigrant workers. And they're just not in a position to give a 
real genuine assent because many of them are just afraid of 
their jobs. 

So, we found in other — we could see that in other 
industries that are peak season industries that are organized by 
the Teamsters, that they're able to give — they don't have to 
work them 84 hours. So, there's no reason for that. But that 
is just one example of what the IWC has been doing. 

So, we look askance at any nominee that comes in that 
continues the same kind of trend of the IWC. 

CHAIRMT^ LOCKYER: Have we heard from everyone that 
wants to make any comment at all? 

I'd like to recommend that we not take a vote today and 
have a chance for some discussion and thought, and I think we're 
getting close to the deadline, the 17th of July. If that's 
agreeable with Members, to give it a little time to marinate. 

Thank you, Mr. Cornford. Did you want to add anything? 

MR. CORNFORD: No, sir. I appreciate the opportunity 
to appear before you, and thank you for your courtesy. 

CHAIRMAN LOCKYER: I think your answers have been 
direct and forthright, and we appreciate it. 



36 

MR. CORNFORD: Thank you, sir — 

CHAIRMAN LOCKYER: Let me jump to Item Number Seven, 
if we could. 

[Thereupon the Rules Committee acted 
on legislative agenda items.] 

CHAIRMT^ LOCKYER: Our next person is Ms. Laethem. 
Good afternoon. 

MS. LAETHEM: Good afternoon, Senator Lockyer, 
Committee Members. 

CHAIRMAN LOCKYER: Do you want to start with my comment 
about what you do? 

MS. LAETHEM: Very briefly, I'm not sure if I want to 
comment about necessarily what we do. 

I would like to thank you for the privilege of being 
able to serve the State of California as California's Public 
Defender for the last seven years. And I would like to ask that 
I be given the opportunity to continue to serve in this capacity 
for the next term. 

I'm very proud of the work that we've done over the 
last seven years. I'm proud of the aggressive representation 
we've provided our clients, the professional representation, the 
the ethical representation. 

I'm equally proud of the fact that we've remained 
cognizant that this is a state agency funded by taxpayer 
dollars. 

I think we've come a long way in this agency, and I 
hope to be able to continue to take the agency even further. 

CHAIRMT^N LOCKYER: Have you had any kind of difficult 



37 

issues during your tenure there that we ought to learn from you 
about? 

MS. LAETHEM: I think capital representation is a 
difficult issue in and of itself. I think that finding 
qualified attorneys to represent our clients is a difficult 
issue. It's complex. It's emotionally draining. This agency 
has now gone through our — a client who was executed, the first 
time that's happened, and it was — it's a very emotional and 
difficult thing to deal with when you've been representing 
somebody for a number of years. 

I was proud of the attorneys in the agency. I was 
proud of the way we handled the case and the way that we 
responded. 

CHAIRMAN LOCKYER: Still having a shortage of people 
available to take on cases? 

MS. LAETHEM: There is, and, hopefully, that will be 
some recommendation ideas for resolving that in the very near 
future. 

CHAIRMAN LOCKYER: Do you assist the private 
court-appointed counsel in some manner? Or, are they just on 
their own? 

MS. LAETHEM: They're assisted by the California 
Appellate Project, whose funding has now — all of the resource 
centers throughout the United States have been defunded by the 
federal government. 

In California, the Appellate Project still receives 
state funding, so they have managed to stay in existence, and 
they do provide assistance to private attorneys that are 



38 

1 handling these cases. 

2 CHAIRMAN LOCKYER: I guess there's the suggestion that 

3 there be a habeas corpus and a direct appeal unit. Could you 

4 explain that issue to us? 

5 MS. LAETHEM: Over the years, the backlog of 

6 unrepresented inmates has built up, and there have been 

7 different ideas to handle this. We used private counsel, civil 

8 law firms. Most of these have been band-aids, and we do have 

9 128 people on Death Row currently unrepresented. 

10 There are some very creative and interesting proposals 

11 to systemically handle this problem. And I believe that, in a 

12 very short time, one of these proposals will be brought to your 

13 attention. 

14 I believe personally that there is no silver bullet. 

15 It's a real complex issue. However, when you have a death 

16 penalty case, it's truly not just one case. There is the 

17 appellate part of it, and there is the habeas part of it. The 

18 case then moves on to federal court. 

19 And I believe that, were the case divided differently, 

20 instead of having attorneys handle the appellate and habe [sic] 

21 side, move on to separate federal counsel, if it was divided so 

22 all of the habe was handled by one set of counsel and the appeal 

23 by another set of counsel, it might provide, certainly, I 

24 believe, more time-effective representation, more cohesive 

25 representation, and would benefit all parties. 

2 6 CHAIRMAN LOCKYER: Even if it is the same number of 

27 attorneys you're dividing up? Is there some expertise 

28 associated with one? 



39 

MS. LAETHEM: Yes, sir. There is a very different 
expertise associated with the appeals than with the habe. And 
that's been a big problem, because attorneys that have been 
trained in the appellate process were then being asked to take 
on what amounts to a trial attorney function with no training. 

And so, you're exactly right. That's where the problem 
lies. I'm hoping that, perhaps, there may be a solution that 
will help us in that area. 

CHAIRMAN LOCKYER: Other questions? 

SENATOR PETRIS: I have a question on the habeas 
corpus . 

Congress is considering legislation now to reduce in 
the federal courts the number of cracks that the defendant can 
get at the procedure. 

How would that impact the work in your office if that 
were to pass? 

MS. LAETHEM: Well, Senator Petris, I believe that at 
this point it has passed, although, as you're aware, it's being 
held up because there are courts that are now ruling on whether 
or not California complies with some of the provisions of this 
legislation. 

We don't do the federal habe, although there would be 
some impact on us because we are in a position of having to 
federalize issues, knowing that the case will move on. 

That could be another big advantage if we divided this 
work differently, because if there was one group of counsel 
doing both the state and the federal habe, they'd be able to 
provide a cohesive type of representation, where, from the 



3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 



40 

outset, they'd be thinking both at the state level and the 
federal level. It would, I think, blunt some of the problems 
inherent from the defense standpoint, while not in any way 
hurting what the federal legislation is trying to implement. 

CHAIRMAN LOCKYER: Senator Ayala. 

SENATOR AYALA: I have a piece of legislation, it's 
over in the Assembly now, that calls for a person who utilizes 
the Public Defender's Office, if they can afford it, to pay $25. 

Do you have any problem with that approach? 

MS. LAETHEM: From the standpoint of the State Public 
Defender, that would not, I think, probably affect us. I 
believe your legislation goes to county public defenders. 

SENATOR AYALA: Should I include the State Public 
Defender, too? 

MS. LAETHEM: W.e have a limited number of clients. 

I personally believe that when people — there are 
large groups of people that cannot afford counsel, and yet do 
have, you know, some means of paying some amount. And some of 
them would probably be grateful to pay some amount. They're not 
looking for a hand-out. They simply can't afford the type of 
fees that private attorneys charge them. 

I believe that the law currently is that the courts are 
supposed to inquire. And if, in fact, they find there is some 
means of making small payments, that should be ordered. 

As far as I know, all counties are entirely different 
in enforcing that, and looking into it, or even dealing with it 
because collection is such a problem. 

SENATOR AYALA: I notice that you have State Public 



41 

Defender Offices in Sacramento and San Francisco. You don't 
have any core of defendants in Southern California? 

MS. LAETHEM: We do, but all of our clients are on 
Death Row. They're all at San Quentin. 

What we do is represent Death row inmates, so all of 
our clients are in the Bay Area. 

SENATOR AYALA: You don't have any of those folks down 
in Southern California? 

MS. LAETHEM: We have clients that come from Southern 
California, but we do not do anything other than death penalty 
representation, so they're all in this area. 

SENATOR AYALA: Thank you. 

MS. LAETHEM: Thank you. Senator. 

SENATOR BEVERLY: Any further questions. 

Anybody here wish to appear on behalf of the nominee? 
Anybody here in opposition? 

SENATOR AYALA: Move the confirmation. 

SENATOR BEVERLY: Senator Ayala moves confirmation be 
recommended, call the roll. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. Senator 



Petris. 



SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

CHAIRMAN LOCKYER: Aye. 



42 

1 SECRETARY WEBB: Lockyer Aye. Four to zero. 

2 SENATOR BEVERLY: Leave the roll open. 

3 MS. LAETHEM: Thank you. 

4 SENATOR BEVERLY: Congratulations. 

5 MS. LAETHEM: Thank you. 

6 SENATOR BEVERLY: Next in order is Mr. Stubchaer. 

7 Senator O'Connell. 

8 SENATOR O'CONNELL: Thank you, Mr. Chairman. 

9 I just briefly want to introduce and lend my support to 

10 Jim Stubchaer, a long time friend of mine, about 15-16 years, 

11 lives in the Goleta area of Santa Barbara County. He was the 

12 Flood Control Director for Santa Barbara County for about 30 

13 years. Very, very active in our community. 

14 He served for the last year on the statewide board, on 

15 the Regional Board for two terms prior to that. Has a 

16 background in civil engineering. Very well respected in our 

17 community. Has worked very, very hard on the statewide board, 

18 and wanted to lend my support to the reappoinment of 

19 Mr. Stubchaer, a man, I think, this Committee is familiar with 

20 from his confirmation process four years ago. 

21 Thank you, Mr. Chairman. 

22 SENATOR BEVERLY: Thank you. Senator. 

23 Would you care to make any kind of statement? 

24 MR. STUBCHAER: Yes, Senator. 

25 Thank you. Senator O'Connell and Senators. I think 

26 Senator O'Connell said about everything I was going to say, but 

27 I am Jim Stubchaer. I'm an engineer member of the State Water 

28 Resources Control Board. 



43 

As you know, we are a five-member board/ and two us by 
law must be engineers. I was appointed to the Board in March of 
'92, and appeared before your Committee and was confirmed by the 
Senate. I was reappointed to a second four-year term this 
January. 

Senator O'Connell mentioned my previous service on the 
Central Coast Regional Water Quality Board, and I also was a 
member of the Water Commission. 

I have a bachelor's and a master's degree in civil 
engineering from USC, postgraduate diploma in hydraulic 
engineering from Delft Technological University in the 
Netherlands. Prior to being on this Board, I was an engineer in 
private practice, then I also managed the Santa Barbara County 
Flood Control District, Santa Barbara County Water Agency. 

I think that concludes my summary of my qualifications 
for being a member of the State Water Board. I'll be pleased to 
try and answer any questions you may have. 

SENATOR BEVERLY: Thank you. 

Any questions of the nominee? Senator Ayala. 

SENATOR AYALA: I want to ask him a question. 

I was convinced that Southern Cal . would go around with 
canteens around their necks by the year 2010. I'm not so sure 
it's true anymore. 

Can you give me an idea whether Southern Cal.'s really 
in great need of additional supplemental water or not? 

MR. STUBCHAER: I can give you an idea. That's not an 
issue that's before this board. 

The drought of the late 1980s instilled what you might 



44 

1 call a conservation ethic in water users of Southern 

2 California. And as a result, the per unit-per capita use of 

3 water has declined considerably. 

4 In addition to that, the water districts and management 

5 agencies have improved their management of the supplies, 

6 planning better for droughts. 

7 I don't think that the people of Southern California 

8 will have to be wearing canteens, but they'll still need to be 

9 frugal in their use of water. 

10 SENATOR AYALA: The Board is in charge of all waters in 

11 California according to court ruling, including the Bay. 

12 If you folks had standards for the Bay, quality 

13 standards, where would all that water come from to meet those 

14 standards. 

15 MR. STUBCHAER: . We have set water quality standards for 

16 the Bay-Delta. 

17 SENATOR AYALA: For the Delta. I'm talking about the 

18 Bay. 

19 MR. STUBCHAER: For the Bay itself. 

20 Well, we've set them for the Bay-Delta complex, but 

21 that's primarily the Delta and not the Bay. 

22 SENATOR AYALA: Nobody has any problem with the Delta. 

23 The Bay, which is almost at sea, what do we do with that salt 

24 water Bay? 

25 MR. STUBCHAER: The San Francisco Bay water quality 

26 problems are not generally fresh water problems. They're toxic 

27 metals, and things like that, that are discharged into the Bay. 

28 The ocean tides dominate the waters in the Bay, as you know. 



45 

and so we don't have water quality standards for the Bay that 
would require fresh water. 

SENATOR AYALA: But doesn't Porter-Cologne take care of 
the toxics in the Bay Area for water quality? 

MR. STUBCHAER: It certainly addresses it, but there 
are still issues, such as Mercury, copper, things like that, 
that are present in relatively small quantities, and it's very 
difficult to get down to maybe five parts per billion in some of 
these constituents. 

So, it's an ongoing issue about, how clean is clean 
enough? And the regional boards do have authority under 
Porter-Cologne, as you suggest, to have the required corrective 
actions taken. 

SENATOR AYALA: But to improve the quality of the 
water in the Bay will necessitate a new source of water going in 
there. 

Before the water in the state is adjudicated, where 
will that water come from? 

MR. STUBCHAER: I'm not is sure that a new source of 
fresh water will be required for San Francisco Bay itself. As a 
matter of fact, there's some concern in the South Bay that the 
discharge from the sewage plants is making the water not salty 
enough, some of those salt marshes. 

So, I don't think, as I said, that fresh water will be 
required for the Bay itself. 

SENATOR AYALA: Thank you. 

CHAIRMAN LOCKYER: The only thing I don't see, how do 
you pronounce this, Stoob-chair? 



46 

MR. STUBCHAER: Either way, Stoob-chair or Stub-chair. 
The Danish way was Stoob-Chair. When I was in the Army, they 
said, "It's Stub-chair." 

CHAIRMAN LOCKYER: I notice a lot of water agencies and 
a few farmers, and so on, that have very nice things to say. 
But I don't see any of the sort of environmental-type groups at 
all. 

Is there any reason for that? Usually they're not 
embarrassed about conveying their opinions. 

MR. STUBCHAER: No, I don't know of any particular 
reason. 

I've tried to be fair and moderate in all of our 
deliberations and decisions. I did not personally solicit any 
letters. I appreciate those which were sent in. 

CHAIRMAN LOCKYER: During your tenure on the Board, 
what was the hardest vote that you remember? Anything come to 
mind? 

MR. STUBCHAER: Well, Mono Lake was a difficult 
decision, trying to balance the loss of water to Los Angeles, 
the loss of hydro-electric power generation with the needs of 
the lake. 

Then the Bay-Delta standards were not really that 
difficult because the various parties arrived at, a consensus to 
present to us. If they hadn't done that, it would have been 
very difficult. 

Now we hope same will happen in our process for 
allocating the water costs of meeting the Delta standards, to 
differentiate from the Bay. And that could turn out to be very 



47 

difficult/ but we haven't done it yet. We're in the process. 

CHAIRMAN LOCKYER: With respect to Mono, was there a 
split vote on the Board. 

MR. STUBCHT^R: No, it was unanimous. 

CHAIRMAN LOCKYER: There seems to be growing concern 
about groundwater supplies being exhausted. 

Do you have any general philosophy or thoughts about 
how we should deal with that? 

MR. STUBCHAER: I believe the buzz phrase today is 
sustainable development. I'm not in favor of overdrafting 
groundwater basins for short-term gain at long-term cost. 

I was — during my career in Santa Barbara County, we 
took measures to address the long-term overdraft in our 
groundwater basins. But as you probably know, in California, no 
government agency has jurisdiction in allocating groundwater, 
unlike the other western states. It's become a property right. 
Groundwater is viewed as a property right. 

So, there is legislation that requires the preparation 
of groundwater basin management plans. I believe that's a good 
step. 

I believe that groundwater management is best done at 
the local level, and some agencies in Southern California have 
been doing that for a long time and are world leaders in that 
regard. There are other parts of California where improvement 
still is needed. 

But we as a state board do not have the jurisdiction to 
impose that improvement, except through quality. If quality 
starts being degraded to such an extent that a basin 



48 

adjudication can be required, we can do that. It was done in 
the Oxnard Plain. There was a threat of it, and consequently, 
pumping restrictions and basin management proposals were put 
into place. 

We are going through that now in the Salinas Valley, 
where there's severe sea water intrusion from Monterey Bay. It's 
almost up to Salinas. And we are trying to get that problem 
addressed by the local entities. 

CHAIRMAN LOCKYER: Yes, Senator. 

SENATOR AYALA: I have one more question. 

What is your position in terms of building holding 
facilities south of the pumps at Tracy so you can capture flood 
water that today, not only they flood the cities, but they go 
out to sea with no control at all. We could hold them in those 
facilities and pump it when we needed wherever in the state. 

MR. STUBCHAER: I think that reservoirs south of the 
Delta, and even south of the Tehachapis, are probably one of the 
best features that can be done in the future, as long as the 
water can be pumped in the Delta. 

The New Magueny Reservoir in your area, that 
Metropolitan is building, has the big advantage of being beyond 
the San Andreas fault. In case there's a rupture of that fault, 
they'll have several hundred thousand acre feet in storage 
there. When water is available in the Delta for pumping, it 
should be, and it can be stored off-stream, so it doesn't have 
the environmental impacts of some of the dams. And I think it's 
a good proposal. 

SENATOR AYALA: One of the big problems with that is 



49 

the fact that the aqueduct itself choked in at 70 percent of 
capacity at the input. We ought to open it up, to use that for 
what it was built for when we built the facility with tax 
dollars. We don't utilize it to its fullest capacity. 

We're wasting tax dollars. And today, the input at the 
aqueduct is choked at the input at 70 percent capacity. It 
doesn't matter what we do in the Delta-Bay to increase the 
capacity of water. No more than 70 percent of its capacity can 
flow south through the aqueduct. 

I know it doesn't matter whether you're building north 
or south of the Tehachapis, because you've still got to pump it 
over the mountains, and that's a cost of power. 

Do you support holding facilities or underground basins 
where we can store the water during flooding conditions? 

MR. STUBCHAER: I support it in concept. I don't have 
any particulars. 

SENATOR AYALA: Good enough. Thank you. 

CHAIRMAN LOCKYER: You have dodged the bullets. They 
weren't coming from him; they were coming from us northerners. 

SENATOR AYALA: I like him. 

CHAIRMAN LOCKYER: Are there any other questions. 

Anyone that wishes to comment? 

The only question I have, frankly, really has to do 
with the duration of the term. I'm beginning to have some doubt 
about whether we should be confirming appointments that run into 
next Governor's term. But I think the next Governor, whoever he 
or she is, will want you to serve and continue doing your fine 
job, so I'm not going to be aggressive about this worry, at 



50 



1 least today. 

2 What's the pleasure of the Committee? 

3 SENATOR BEVERLY: Move we recommend confirmation. 

4 CHAIRM/y^ LOCKYER: All right, call the roll. 

5 SECRETARY WEBB: Senator Ayala. 

6 SENATOR AYALA: Aye. 

7 SECRETARY WEBB: Ayala Aye. Senator Lewis. Senator 

8 Petris. 

9 SENATOR PETRIS: Aye. 

10 SECRETARY WEBB: Petris Aye. Senator Beverly. 

11 SENATOR BEVERLY: Aye. 

12 SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

13 CHAIRMAN LOCKYER: Aye. 

14 SECRETARY WEBB: Lockyer Aye. Four to zero. 

15 MR. STUBCHAER: - Thank you, Senators. 

16 CHAIRMAN LOCKYER: Keep up the good work. 

17 [Thereupon. This portion of the 

18 Senate Rules Committee hearing was 

19 terminated at approximately 4:02 P.M.] 

20 — ooOoo — 
21 
22 
23 
24 
25 
26 
27 
28 



51 



CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California, do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 

/ IN WJ3^ESS WHEREOF, I have hereunto set my hand this 
rO^ '^ day of /__ U^»-^ , 1996. 








'Shortha^ Repoj^%^r 



306-R J 

Additional copies of this publication may be purchased for $3.50 per copy 
(includes shipping and handling) plus current California sales tax. 



Senate Publications 

1020 N Street, Room B-53 

Sacramento, CA 95814 

(916)327-2155 

Make checks payable to SENATE RULES COMMITTEE. 
Please include Stock Number 306-R when ordering. 



1 



L Soo 

ill 



SEP 1 8 1996 



# 



HEARING 

SENATE.RULES COMMITTEE 



STATE OF^CALIFORNIA 



'"'^r. 



Sa 



''^Si.'C LloH^rti! 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

MONDAY, AUGUST 5, 1996 
2:20 RM. 



307-R 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 



MONDAY, AUGUST 5, 1996 
2:20 P.M. 



Reported by 



Evelyn J. Mizak 
Shorthand Reporter 



11 



APPEARANCES 

MEMBERS PRESENT 

SENATOR WILLIAM LOCKYER, Chair 

SENATOR ROBERT BEVERLY, Vice Chair 

SENATOR RUBEN AYALA 

MEMBERS ABSENT 

SENATOR JOHN LEWIS 

SENATOR NICHOLAS PETRIS 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 

PAT WEBB, Committee Secretary 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

JOHN T. FLYNN, Director 

Department of Information Technology 

SENATOR QUENTIN KOPP 

MARGIE J. PHARES, Member 
Fish and Game Commission 

SENATOR STEVE PEACE 

GERALD MERAL, Executive Director 
Planning and Conservation League 



Ill 

INDEX 

Page 

Proceedings 1 

Governor's Appointees t 

JOHN T. FLYNN, Director 

Department of Information Technology 1 

Introduction and Support by SENATOR QUENTIN KOPP 1 

Discussion of Year 2000 problems 3 

Questions by CHAIRMAN LOCKYER re: 

Most Complicated or Difficult 

Issue So Far 4 

Hiring of Staff 4 

Lessons Learned from Mistakes 

of Other Agencies 5 

Report to Legislature 6 

Data Center Consolidation and 

Roles of Department of Finance and 

Department of Information Technology 7 

Questions by SENATOR AYALA re: 

Background of Staff 8 

Large Staff Turnover 10 

Number of Projects Reviewed and Approved 11 

Questions by CHAIRMAN LOCKYER re: 

Efforts to Rationalize CALNET 12 

Motion to Confirm 13 

Committee Action 14 

MARGIE J. PHARES, Member 

Fish and Game Commission 14 

Introduction and Support by SENATOR STEVE PEACE 15 

Questions by CHAIRMAN LOCKYER re: 

Most Difficult Issue 19 



IV 



Legal Obligations When There Are 

Conflicts between Economic Benefits and 

Species Preservation 21 

Observations on Process Used for 

Listing Species 22 

Interview with Planning and Conservation 

League Representative 23 

Questions by SENATOR AYALA re: 

Biggest Issue or Problem Facing Department 

of Fish and Game 23 

Protection of Designated Land from 

Developers 24 

Questions by CHAIRMAN LOCKYER re: 

Current Status of Otay Mesa Habitat 

Protection Proposal 25 

Ownership of Property within 

Designated Area of NCCP 26 

Witness in Opposition: 

GERALD MERAL, Executive Director 

Planning and Conservation League 28 

Response of Nominee 30 

Statements by SENATOR AYALA re: 

Need for Common Sense on Commission and 

Not Necessarily Expertise 31 

Committee Action to Hold Nomination 

in Committee for Future Action 32 

Termination of Proceedings 32 

Certificate of Reporter 33 



P-R-0-C-E-E-D-I-N-G-S 
— OOOOO — 

CHAIRMAN LOCKYER: Let's go to the next item, which is 
Mr. Flynn. Senator Kopp/ you're on time for Mr. Flynn. 

SENATOR KOPP: Thank you very much, Mr. Chairman. 

I would like to present John Flynn to this Committee 
and recommend his approval. And I do so because, not of a 
personal friendship with Mr. Flynn, who is originally from the 
Boston area, but as Chairman of the Select Senate Committee on 
Information Technology in State Government, which was 
established almost three years ago. 

Mr. Flynn was appointed last year by the Governor to 
his present position as Chief of Information Technology, 
consistent with legislation that was introduced by Senator Al 
Alquist and enacted by the Legislature and the Governor. 

My testimony and my belief are based upon my experience 
and observation of Mr. Flynn over the period since he has been 
appointed. 

In the role of Chief of Information Technology, or as 
it's probably more popularly referred to, as the Information 
Technology Czar in the executive branch, he has personally 
appeared at two hearings of the Select Committee. He's provided 
staff assistance with respect to two further hearings. He has 
included our Committee in planning a Technology Demonstration 
Day for the Legislature. I don't know if you recall that, but 
it was certainly novel. 

He has ordered the staff of the office to participate 
in a task force on public access to computerize government 



records in connection with bills effecting provisions of the 
California Public Records Act, which I introduced last year, and 
which is up on Wednesday before the Assembly Appropriations 
Committee, it's SB 323. 

He has had but a limited period of time to accomplish 
the requirements of Senate Bill 1 from the last session. His 
staff is still being assembled. He, however, was able to 
deliver on time the first annual report of that office to the 
Legislature. And he has certainly emphasized some of the 
successes of information technology in California state 
government. And those successes are probably over shadowed, 
unjustifiably, by the failures that antedated his appointment. 

He does, Mr. Chairman and Members, for the record, need 
in my strong opinion, strong support from the chief executive of 
the State of California to accomplish the objectives embodied in 
SB 1 literally and as a matter of legislative intent. And I 
give you two examples in that respect, not to deflect or detract 
from my recommendation of confirmation, but because I want to 
make it a part of the record, Mr. Chairman and Members. 

Funding for the year 2000 improvements in information 
technology was uniformly denied by the Department of Finance 
despite Mr. Flynn's clear demonstration of the fact the state 
could save a significant amount of money if it were 
accomplished. And conversely, that the state would incur 
additional cost by reason of inaction. 

And secondly, there must be strong support by the 
Governor for Mr. Flynn insofar as policy making for project 
management over the new telecommunications infrastructure, which 



is a very difficult procurement/ very complex. That power was 
reflected in Senate Bill 1266 which the Senate passed, the 
Assembly passed, and then was opposed by the Department of 
General Services after it was presented to the Governor, and the 
Governor eventually vetoed it. 

So, those are the points pertinent to the individual 
who, I believe, sincerely possesses the strong desire and 
motivation to furnish California with nothing but successes in 
the development of information technology. At the same time, I 
do memorialize for the record the need for both legislative 
support, which would be embodied in his confirmation, but also 
executive support after that confirmation occurred. 

Thank you. 

CHAIRMAN LOCKYER: Thank you. Senator, very much. 

Mr. Flynn, welcome, and is there any sort of general 
thing you'd like to say as an opening? 

MR. FLYNN: Not in particular, Mr. Chairman, but I 
would just like to mention on Senator Kopp's gracious remarks 
there. 

I do believe that, particularly on something like the 
year 2000 issue that everybody's heard a little bit about, in my 
case I've probably heard a little bit too much about, but 
frankly, one of the rules I've always had, I don't think you 
take a problem to your boss until you've got some kind of a 
solution for it and have identified the problem appropriately. 

I think in the question of the year 2000, what we have 
done is, we have established a statewide task force made up of 
members from virtually every agency in state government, and 



their initial task will be to determine what the impact is of 
this year 2000 problems before we go to anyone and come up some 
kind of requirement for funding. 

In addition, I have also tasked agencies within state 
government to start looking in among themselves at where they 
could save money on some of their programs through the 
utilization of information technology in order to pay for some 
of these year 2000 problems. 

So, I do believe that the Senator and I have a little 
bit of a gentlemen's disagreement on that, and I think what 
we're doing is the right approach: identify the problem; 
identify the impact; scope it in terms of finances and resources 
that are required; and then look to ways of funding it. 

CHAIRMAN LOCKYER: I guess there are a number of 
questions that are significant but do get somewhat technical, 
and I don't want to get us off on too many detailed tangents. 

Perhaps a way to introduce the topic is to ask you what 
the most complicated or difficult issue has been so far that 
you've had? 

MR. FLYNN: Well, I think, Mr. Chairman, that the 
problems I have so far have been kind of two-fold. One has been 
putting together a staff, which is always difficult, 
particularly in a public sector environment. 

CHAIRMAN LOCKYER: Is that done now? Have all the 
slots been filled? 

MR. FLYNN: Well, we were counting heads on the way 
over here, Mr. Chairman, and we have fifteen bodies there 
today. I have fifteen positions, and there's several of those 



are still unfilled. 

We are utilizing interns from the CSUS, as well as some 
loaned employees. We're almost there. I expect to be fully 
staffed from our fifteen positions in the next several — 
certainly no more than a month or so. And we have — all the 
new positions are being — we are preparing advertisements at 
this time. So, we expect to be fully staffed up in the 
short-term. 

But as I was saying, that has proved particularly 
vexing, but in addition, I think the most critical thing on my 
agenda has been oversight on some of these big, major, complex 
information technology projects. Projects whose, let's say, 
less than a matter of less than — their less than successful 
outcomes resulted in me moving from Boston, as a matter of 
fact. I think that's been our first course of business. 

CHAIRMAN LOCKYER: That's D.M.V., some of the other. 
Social Services? 

MR. FLYNN: Yes, sir. 

CHAIRMAN LOCKYER: Anything missing? What did you 
learn, in looking back at all of that? 

MR. FLYNN: I think the biggest thing we learned from 
those episodes is the fact that there wasn't independent 
oversight that was able to identify problems early on in the 
process, bring those problems to the attention of the decision 
makers, and at that point in time, work out a flexible, a 
structured scenario to get the project back on track, or to 
abandon it altogether and cut the loss. 

And frankly, that's what happened, I think, now. We 



have evidence that these independent oversight firms that we 
brought on board have been able to identify problems early on. 
Require stringent reporting requirements to the vendors, and if 
we recognize the problem, we stop the project. We stop it until 
it's straightened out. 

And I would just like to emphasize one other thing. 
And I'll go on record here, we are going to have problems. 
There are going to be more problems. 

We're a large organization, sixth or seventh largest 
economy in the world. Even the private sector, according to CIO 
Magazine, estimates that over 50 percent of major complex 
information technology projects in the private sector could 
fail. 

That's why it's so important to break down some of 
these mega projects, if you will, into more feasible, phased 
implementations to improve the chances of success. 

CHAIRMAN LOCKYER: There is a comment in staff work 
sheets that, I guess, could be called modestly critical of the 
July interim report, suggesting that it is a little bit light on 
sort of clear task objectives, and potential outcomes, and 
schedules. 

Is it just — 

MR. FLYNN: That's a fair assessment, Mr. Chairman. As 
a matter of fact, we've already met with representatives from 
the Legislative Analyst's Bureau to go over those particular 
issues . 

I agree. I base all my work and all my staff's work 
and our entire organization on work plans, with detailed bar 



charts, and dates, and graphs, et cetera. And we are in the 
process of putting together our strategic plan. That's the only 
way I manage, is with those kinds of tools. 

CHAIRMAN LOCKYER: It seems like that's partly what 
went wrong in the past. So, just by way not replicating the 
mistake, you seem to be sensitive to that. 

MR. FLYNN: Right, exactly. 

CHAIRMAN LOCKYER: There also is some analysis of 
proposals for data center consolidation, and a suggestion that 
there is a little bit of, I guess, lack of clarity as to the 
Department of Finance's role, and your Department's obligations. 

MR. FLYNN: Certainly, I think the fact that my 
organization, the Department of Information Technology, the 
former Office of Information Technology, and before I came on 
board, the Governor's Task Force on Technology and Policy and 
Procurement had recommended and established, actually, the 
Governor's Office of Technology. In fact, when I first 
interviewed for this position — a quick story Mr. Chairman — I 
said. Governor's Office of Technology, a GOT. And I said, "Is 
that got or is that goat, as in scape goat?" I wasn't sure what 
I was setting myself up for. 

But frankly, there was a bit of confusion. I think 
there was some confusion over the roles of the organizations, 
but we are working very closely with the Department of Finance 
to make sure that there is no redundancy or conflict in the 
goals of both organizations. Certainly, the Department of 
Finance, and through its Technology Investment Review Unit, is 
responsible for final budget approval for all information 



8 

technology projects. 

CHAIRMAN LOCKYER: So, you don't see the separate 
efforts as duplicative or confusing? 

MR. FLYNN: Regarding data center consolidation, no. 
I think there was some confusion over the funding for the audit 
that was being done by the Department of Finance. They were 
going to audit the rates of the Department, and I think that's 
most appropriate. I think it's required by federal statute, as 
a matter of fact. 

As you know, a lot of our programs, for example, in the 
social service area, the Health and Welfare Data Center, et 
cetera, those charges have to be applied against the federal 
contracts, and those changes must stand up to federal scrutiny. 

CHAIRMAN LOCKYER: So, that's a separate effort than 
what you're undertaking? 

MR. FLYNN: Yes. 

CHAIRMAN LOCKYER: Senator Ayala. 

SENATOR AYALA: Mr. Flynn, you're authorized fourteen 
positions besides the Director, yourself. You filled nine of 
those positions; three have already left, I understand. 

What kind of background do they have? I understand one 
of the people you hired was a speech writer, and another one was 
appointed to run the Assembly Computer Services. 

What background do they have to fit into your program? 

MR. FLYNN: Senator, good question. But take into 
consideration the fact that we are a department. We are a 
department that reports directly to the Governor. 

I'd be lying if I didn't say that a major portion of my 



job is the tracking of legislation and things going on over in 
this building. It's amazing how many different — in fact, if 
we didn't have the ability to search the Internet for 
information to determine where information technology, and 
computers, and Internet come up in so many different bills — I 
mean, even today, several Legislators mentioned the use of 
technology. 

We have to track legislation, and the person you're 
referring to that came over from the Governor's Office is 
primarily responsible for that. As a matter of fact, the 
individual wears about five hats in addition to his legislative 
responsibilities . 

It's kind of just like a hospital. You're not going to 
find nothing but surgeons working there. We've got to have some 
staff people. We've got to have people familiar with the 
Legislature. We have to have media people. And I think we've 
done a good job at that. 

I don't have enough positions — I don't have enough 
people to use them not frugally. 

SENATOR AYALA: Again, my question is, are those people 
qualified? 

MR. FLYNN: Absolutely. 

SENATOR AYALA: With the technical background to fit 
into your program? 

MR. FLYNN: Absolutely. As I said, I have done 
extensive background reviews of all my staff. As I said, I'm 
not about to squander my resources in such a way. 

I'm not going to get marked here on how many people I 



10 

found a job for. I'm going to get marked on how good a job we 
do overseeing these I.T. projects and utilizing the resources of 
the taxpayers of California in the best way through coordinating 
our implementations of technology. 

SENATOR AYALA: Three of the nine have already 
resigned. Why is there such a large turnover? 

MR. FLYNN: Well, I think, in fact, some of them were 
transferred, sir. I don't think they were truly resigned. 

Let me put it this way. As I mentioned earlier in my 
little aside there, this organization, before it had a chief 
information officer, went through several iterations, the 
Governor's Office of Technology, and other ones, before it 
became the Department of Information Technology. 

Individuals were loaned to our department and have gone 
back to other agencies. I think that's the case in two out of 
three of those issues. And in the third one, it was a transfer 
to another agency, which was a mutual agreement. 

SENATOR AYALA: Reading information on your 
department, I hope it doesn't become catch-all for the Senate, 
or the Assembly, or the Governor for people they want to dispose 
of. 

MR. FLYNN: I wouldn't stand for that, sir. I would 
not stand for that. You have my word. 

CHAIRMAN LOCKYER: That's OCJP, Office of Criminal 
Justice Planning. 

SENATOR AYALA: I just had some questions about the 
nine positions you've filled, and the high turnover, and then 
the qualifications of these folks to really fit into your 



11 

program of what you're trying to accomplish. 

MR. FLYNN: As I said, I want to make sure I have the 
best people for the job. I think that's one of the reasons 
these appointments have taken as long as they have, that we just 
don't want to squander those opportunities with people you know 
that are going to make or break this organization. 

We've been very fortunate to attract people not only 
from within government, but within the private sector as well, 
as was intended by the Governor's task force. I think we're 
building a staff now that we're starting to attract some of the 
more exceedingly brilliant and innovative folks from within 
state government to our organization. I think that's a big 
positive. I think a lot of it had to do with what we've been 
able to accomplish these first six months. 

SENATOR AYALA: How long has that been in existence? 

MR. FLYNN: January first, the Department became 
full-fledged. 

SENATOR AYALA: How many minor and major information 
technology projects have you reviewed or approved? Are there 
any major or minor information technology projects that you have 
approved or reviewed in that time? 

MR. FLYNN: As a matter of fact, we just went through 
— I'm pretty much a stickler on the numbers, and we get 
anywhere — I think the number was 76 new projects every year 
from throughout state government, totaling in the billions of 
dollars. Some of them are multi-year projects. The vast 
majority of those projects have been approved, probably in the 
neighborhood of 50. The rest are requiring more information or 



12 

have been denied. 

At the same time, we are looking at projects, as I 
mentioned earlier, that are ongoing in nature. The one that I 
think that has gotten the most interest has involved the 
Corrections Management Information System, where, working with 
the executive, Jim Gomez, and the success partner, Logicom, it's 
a private sector organization, we identified some problems with 
this implementation and stopped the project. 

SENATOR AYALA: I have no other questions, 
Mr. Chairman. 

CHAIRMAN LOCKYER: Are you undertaking some kind of 
effort to rationalize CALNET, and who would participate, and 
what costs? 

MR. FLYNN: Sure. It's interesting, because you ask 
people what CALNET means, five people, five different answers. 

I look upon the CALNET initiative, as I think most 
people know it here, as an attempt to rationalize the 
telecommunications infrastructure, which is a fancy word that 
people use for basically the underlying and the foundation of 
our wires that connect our different computers across the state. 

To take a look at how it sits right now, you have about 
17 major networks that are owned, or operated, sometimes 
operated by the private sector, in support of various functions 
of the state. For example, you have the Health and Welfare 
Data Center with a major network. You have the Teale Data 
Center with a major network. You have the Department of Motor 
Vehicles would have a major network, and so on. 

Well, what happens is, every time one of these folks or 



13 

one of these agencies decide they need a network, they go out 
and say, "Well, I want to run dedicated lines from Sacramento to 
San Francisco to L.A. to San Diego, across the state." 

Well, the same thing happens the next time another 
agency wants to do it, and so on, and so on, and so on. So, 
consequently, you are having redundant dedicated lines that, 
say, run between various cities, and each one of them may only 
be used about 50 percent, 60 percent of the time in many cases. 

Whereas, if you went to the vendor in a unified way and 
leveraged the resources of the state, you say, "Listen, here's 
how much band width we need for this connection. Just sell us 
what we need. Don't sell us one for each agency." 

That's the whole concept behind this integration of 
CALNET. It's a very exciting opportunity. In fact, we're 
looking at, in working with DGS, we're looking at a possibility 
of taking three — or it may be as high as five hundred million 
dollars a year in telecommunications cost, and saving up to 20, 
25 percent of that; money that could be invested in things like 
the year 2000 problem, or new applications, or video 
conferencing, et cetera, for government. 

CHAIRMAN LOCKYER: Other questions. 

Is there anyone present who wishes to present any kind 
of testimony. 

If not, I'll ask Senator Beverly for a motion. 

SENATOR BEVERLY: Move we recommend confirmation. 

CHAIRMAN LOCKYER: Anything you want to add in 
conclusion? 

MR. FLYNN: Thank you for your support. 



14 

CHAIRMAN LOCKYER: Let's call the roll. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. Senator 
Petris. Senator Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

CHAIRMT^ LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Three to zero. 

MR. FLYNN: Thank you, sir. 

CHAIRMAN LOCKYER: We're counting on you to straighten 
out some of these problems. 

Ms. Phares is our next person to hear from. 

Good afternoon. 

MS. PHARES: Good afternoon. I was expecting Senator 
Peace to come and introduce me. 

CHAIRMAN LOCKYER: He can pop in at any time. 

Do you want to start with any kind of introduction, or 
explain what you're doing, who you are, anything like that? 

MS. PHARES: Okay. I thought Steve was going to 
introduce me. 

CHAIRMAN LOCKYER: If you want, we'll just wait a 
minute until he shows up. Just sit right there, and let's take 
up another item. 

[Thereupon the Committee acted on 
legislative agenda items.] 

CHAIRMAN LOCKYER: Senator Peace, back to item number 
two. 



15 

SENATOR PEACE: Good afternoon. 

CHAIRMAN LOCKYER: Did you want to say anything of an 
introductory sort? 

SENATOR PEACE: HaVe we just started? 

CHAIRMAN LOCKYER: Yes, we're waiting for you. 

SENATOR PEACE: Well, I'm here. 

I appreciate the opportunity, Mr. Chairman, to say a 
couple brief comments on behalf of Ms. Phares' nomination. I 
had the opportunity to work with her over the past few years in 
a couple of different iterations in public work. 

She has served as an appointee in varied capacities at 
the local level as well as the most recent appointment on the 
Commission. 

She has taken on tasks that often are inherently 
controversial, and I believe, more than anything else, has shown 
herself to be a person who is willing to learn while on the job, 
if you will. She has not always been a person who necessarily 
knew the ins and outs of all of the intricacies and the 
controversies that are typically associated with some of these 
appointments, but she's taken the time, unlike many other 
appointees I've observed over the years, to become 
knowledgeable . 

And in each case where folks may have been discomforted 
by or uncertain about her appointment initially, parties on all 
sides have come to respect her work product as being 
deliberative, as being a person who is very open to both the 
prospectives of differing constituencies, and, I think, most 
importantly, and I think the point I want to underline, willing 



16 

to be open-minded herself about issues, and not at all driven in 
her decision making process by some sorts of philosophical 
mandate that she felt that she brought as a part and parcel of 
her appointment. 

She is, I believe, a person who has shown the 
willingness and to dedicate both the commitment to looking at 
each issue that is before her on a case by case basis, and 
attempting to understand what her responsibility is, the 
fiduciary, the public, is. 

And also most importantly, brought along with that, 
that willingness, a willingness to spend a lot of time. We very 
commonly find appointees in these kinds of positions whose time 
on task consists of the time that they attend the meetings. 

I think if there's one trait which sets this nominee 
apart from all the others, frankly, all others that I have ever 
witnessed, is the amount of time that she puts into it. Whether 
you like the ultimate conclusion she comes to, or you don't like 
the ultimate conclusion she comes to, she puts a great deal of 
time and effort. 

There are a couple occasions, to be honest with you, 
sometimes she has been somewhat exhausting on a couple of 
circumstances in which I have been involved. Sometimes she 
wants to know more than I want to tell her in terms of the 
amount of time I've been willing to put into thing. 

She's a detail person. It, no doubt, is part of what 
has made her successful in her private life, but she is 
voracious in terms of her inclination to want to absorb 
knowledge, and to take that knowledge, organize it, and try to 



17 

make the best decisions that she can with it. 

I have been on both sides of the fence with respect to 
issues in which she has been in circumstances to have influence 
and decision on in terms of where I've agreed with her and 
others where I've disagreed with her. I could not criticize her 
in either case, though, with respect to the process by which she 
came about drawing conclusions in terms of what her final 
decision would be. 

She is, I believe, a very independent thinker. That is 
probably, in part, one of the things that I may, in principle, 
find attractive about her as a nominee, but I also find 
frustrating on other occasions when one of us may want something 
to happen and find she has to be convinced on her terms, not 
necessarily ours. 

She, too, is a San Diegan, and as you know, we have a 
predisposition for favoring our fellow San Diegans. I make no 
apologies for that interest as well. 

But she also a San Diegan who is nominated, who I have 
a great deal of confidence in would not, down the line, be one 
that would turn out to be someone we would have regretted having 
supported. 

As you know, this is only the second nomination I've 
ever taken the time to come before this body in support, Mr. 
Neeper being the prior. 

CHAIRMAN LOCKYER: Who was the other? 

SENATOR PEACE: Mr. Neeper, PUC Commissioner. 

CHAIRMAN LOCKYER: How do you feel about that today? 

SENATOR PEACE: Better every day. The more Mr. Fessler 



18 

talks, the better I feel about Mr. Neeper. 

And I will try to continue to not make it a habit to be 
here, but I felt very strongly, particularly in light of, I know 
there's some concerns with respect to her nomination. And I 
respect some of those concerns that have been reflected in the 
record and in writing in terms of understanding where those 
constituency groups have some misgivings. 

I also believe that over time, the concerns that they 
have, and the misgivings that they have, and the fears that they 
have will be, if not eliminated, mitigated by virtue of the 
conduct of the Commissioner over time. 

CHAIRMAN LOCKYER: Part of the problem, Senator, and it 
really almost — it doesn't go to Ms. Phares ' qualifications, is 
that a majority of the five-member Commission are, in one manner 
or another, associated with land development and real estate. 

And at some point you just wonder how much is too much 
of that perspective on a commission that should arguably be more 
balanced. That's one of the problems we have. 

The good news is that the term expires kind of 
concurrent with Pete Wilson leaving, and so the next Governor 
might have something to say about who the slot would be filled 
by, unlike some of the other members of the Commission that run 
into the next century. 

SENATOR PEACE: I would hope the Chairman also might 
solicit the nominee's support and recognition of that imbalance, 
as least insofar as it is reflected in the background of the 
commissioners, and give some indication of how she would intend 
to factor that into the decision making. 



19 

CHAIRMAN LOCKYER: Thank you very much. Senator. 

SENATOR PEACE: Thank you. 

CHAIRMAN LOCKYER: Well, okay, now it's your turn. 
Take a deep breath, and it's okay. We'll ask some questions to 
begin, and you can tell about yourself. 

You've been serving almost a year. 

MS. PHARES: Since last October. 

CHAIRMAN LOCKYER: What would you view as the most 
difficult issue that's come up during that time. 

MS. PHARES: Probably working with the commercial 
fishermen and the sports fishermen, trying to resolve their 
issues related to the white sea bass management program. 

You've got people that are traditionally not conducive 
to working with each other, and I've been appointed as a 
subcommittee of the Commission to try to work with the two 
different constituencies, and trying to come to some resolution. 

CHAIRMAN LOCKYER: There hasn't been a policy yet? 

MS. PHARES: Yes, there's been a policy approved by the 
Commission. 

CHAIRMAN LOCKYER: Who's unhappy? 

MS. PHARES: Well, probably some of the commercial 
fishermen. It's not that they're -- well, they are unhappy, but 
they have some concerns. It's not specific to this program. It 
is has to do with the history of where they're coming from. 
They admit that that's part of where the problem is. I've been 
making an effort to meet with their different representatives up 
and down the state. 

And one of the comments I got from the last gentleman I 



20 

met with was, "You're the first commissioner that's ever spent 
any time coming and talking to the commercials and trying to 
learn more about our problems." He said, "I have to give you 
credit for that." 

And I have been. I think that's one of the things I've 
been doing. I've been spending a lot of time trying to meet 
with different groups, different people throughout the state 
that are -- have come to our Commission and are on our agendas 
with items, and try to get to know where they're coming from, 
and understand what their concerns are. 

And I think I've probably done a very good public 
relations type of job for the Commission in that respect, and I 
made myself available to a lot of people since I've been there. 
I've probably been spending about 50 percent of my time working. 

CHAIRMAN LOCKYER: Fifty percent? 

MS. PHARES: Yes. 

CHAIRMAN LOCKYER: I have a feeling that's probably 
more than other members of the Commission. 

MS. PHARES: Well, I don't know how to do anything 
halfway, unfortunately. If I'm going to do it, then I'm going 
to do the best I can. And it kind of keeps snowballing, because 
every time you do something, then you think of something else 
you should be doing. 

You asked about the coho salmon. That issue has not 
come up before the Commission during the time that I've been on 
there. 

It's my understanding it was listed south of San 
Francisco as an endangered species, and that was an unanimous 



21 

decision by the Commission, but it hasn't come up since I've 
been on the Commission. 

CHAIRMAN LOCKYER: If there are conflicts that come 
before the Commission between economic benefits to the State of 
California or an area, and species preservation, how do you 
understand your legal obligations with respect to that? 

MS. PHARES: It's my legal obligation that the 
economics are not taken into consideration when considering 
endangered species petitions. That this is done through a 
public hearing process where we take staff recommendation, we 
take the petitioner's recommendation, we take input from the 
public, which can come from a variety of sources: the general 
public, the scientific community. And we weigh all that 
information and make a decision. 

And unlike what's done at the federal level, this is 
all done in a public forum, rather than kind of a group where 
people don't know what's going on. 

And people feel very strongly about these issues. Most 
all the issues that come up before our Commission, people feel 
very strongly about. 

And you can't make everyone happy. You just have to 
look at each issue, decide on the information and the testimony 
that you hear, and make the best decision you can. That's what 
I've been trying to do. 

CHAIRMAN LOCKYER: I think I heard you say ~ but you 
speak so softly — that it was your view that, at least as far 
as the law is concerned, that you're not supposed to consider 
the economics. Just whether the species is, in fact. 



22 

endangered, and what can be done about that? 

MS. PHARES: Right. 

CHAIRMAN LOCKYER: Are there questions from Members? 

Have you had an opportunity yet to think about what 
you've viewed as the process that's used for listing? Whether 
you think it makes sense, if it needs to be changed? Do you 
have any sort of observations of that sort yet? 

MS. PHARES: Well, we've only had — I mean, since I've 
been on the Commission, those issues have only come up twice. 
All of the other issues, the other 20 or 25 agenda items have to 
do with more fish and game type related activities or 
decisions . 

But although the public hearing process isn't perfect, 
and it's not always the easiest way to handle things — being a 
benevolent dictator would be a lot easier — I think it's a much 
better process than delegating it to a committee of any sort 
that goes out of view of the public and makes a decision and 
there's no accountability. People, I think, would find that far 
more disquieting and disconcerting, wondering what's going on, 
who's in control, and they don't have any input. 

So, although the public hearing process is not perfect, 
I can't think of a better one right offhand. 

CHAIRMAN LOCKYER: There's a note, an interview — I 
guess these folk will have a chance to testify, but maybe I can 
at least ask the question. This was a discussion that had 
occurred with the Planning and Conservation League, where, I 
guess, they had some interview or discussion with you. 

They make a point of your saying that you consider 



23 

yourself a private property rights person. 

MS. PHARES: I think they asked me if I believed in 
private property rights, and I said yes. 

CHAIRMAN LOCKYER: There aren't many that wouldn't say 
yes to that. 

How about thinking that the Endangered Species Act 
might be unfair? Is that your view? 

MS. PHARES: No. 

CHAIRMAN LOCKYER: If there aren't questions — 

SENATOR AYALA: I want to ask you, what do you consider 
biggest issue or problem facing the Department of Fish and Game 
today? 

MS. PHARES: Everyone of our issues that come before us 
are highly emotional issues for people to deal with. 

SENATOR AYALA: There's not one that stands out in your 
mind as the biggest issue? 

MS. PHARES: It's sort of like, each meeting there's a 
big issue. 

SENATOR AYALA: You've got little problems and big 
problems. What do you think is the biggest problem facing the 
Department of Fish and Game today? 

MS. PHARES: The issues that I've been working on, 
white sea bass management program, I've been part of a 
subcommittee that's been negotiating and meeting with Hoopa and 
Urok Indians in Northern California on Native American issues as 
they relate to fishing rights and stuff on the Klamath River. 

I've been part of the subcommittee that's meeting with 
the U.S. representative from Mexico to try to facilitate better 



24 

working relationships between our enforcement division and 
Mexico to cooperate and exchange of information. That's 
ongoing. 

I'm trying to get meetings set up with our counterparts 
in Mexico to kind of facilitate better working relationships 
with our country and Mexico as they relate to fishing management 
issues, endangered species issues, that we have problems with 
enforcement, and there hasn't been an exchange or cooperation — 
exchange of information or much cooperation in the past. So, 
I've been working on that because the U.S. representative from 
Mexico happens to be in San Diego. So, I've been working on 
that. 

They're all b'ig problems. 

SENATOR AYALA: Do you have a problem with protecting 
that land which is designated for Fish and Game from developers, 
from development. 

I know that a lot of developers support you. That's 
why I'm asking you that. 

MS. PHARES: Well, it's probably been my background of 
being a real estate consultant, where I've had an opportunity to 
work with them. So, they know me. 

SENATOR AYALA: That doesn't cause a problem for you 
when it comes to protecting that land which is for that purpose? 

MS. PHARES: In San Diego, we are working on setting 
aside 165,000 acres under an NCCP program. 

SENATOR AYALA: To protect under the law? 

MS. PHARES: Yes, and that requires the cooperation of 
developers, local agencies, land owners. And those have been 



25 

ongoing negotiations and efforts since 1990 in San Diego. We're 
finally, maybe by the end of this year, we are hopeful that 
we're going to have that plan in place. That's going to be a 
benefit to all of us in the' development community. It's very 
interested in having that go forward, as well as many local 
agencies . 

I met with Secretary Babbit here recently in discussing 
that when he was out here signing the NCCP program in Orange 
County. That's a 37,000 acre preserve that we've set aside. 

In fact, I attended the meeting in hopes that I would 
get to chance to talk to him about what we were doing in San 
Diego. I did get a chance to talk to him, and it turned out he 
was giving me a pep talk on the plan that we were doing in San 
Diego. 

So, this is really an effort that has bipartisan 
support. It has support from the development community, the 
private sector and local agencies. It's very complex 
negotiations, but we're working very hard on it. 

CHAIRMAN LOCKYER: You mentioned the Orange County 
habitat preservation proposal. One of the other ongoing 
disputes involves large sections of San Diego County, especially 
around Otay Mesa. 

What's the current status? 

MS. PHARES: Well, we expect to have that plan approved 
by the end of this year. And it's setting aside about 165,000 
acres in San Diego, all with connecting corridors. So, it's 
planning for habitat an ecosystem system, rather than a species 
over here, and a species over here, and then they end up getting 



26 

isolated, and it doesn't work very well. 

This is kind of an innovative, creative approach to 
conservation, and it has required facilitations with people that 
are not necessarily used to working together. But this is in 
everybody's best interest. 

It's right in my back door, and I'm looking forward to 
it being there for a long time. 

CHAIRMAN LOCKYER: I guess one of the questions, and 
I'm sorry to inquire into personal finances, but it's one of the 
questions that's come up, is that you have some property right 
in the middle of that? 

MS. PHARES : I do not own any property in the middle of 
the NCCP. 

CHAIRMAN LOCKYER: How about a lien claim? 

MS. PHARES: I have a lien against property that is 
security for a stipulated judgement, and that property is not in 
the NCCP. That property is probably due for approval tomorrow. 
It only means I will get paid. I will never get that property. 

CHAIRMAN LOCKYER: I didn't hear you. 

MS. PHARES: I said that property, I think, is coming 
up for approval tomorrow. It only means I will get paid. I 
will never own that property. It's not in the NCCP. It's only 
security for a loan. 

CHAIRMAN LOCFCYER: What do you mean comes up for 
approval? 

MS. PHARES: It's — the owner of the property is 
developing it. 

CHAIRMAN LOCKYER: And they need to get approval from 



27 

« 

whom? 

MS. PHARES: The local jurisdiction. 

CHAIRMAN LOCKYER: City Council or supervisors? 

MS. PHARES: Yes. 

CHAIRMAN LOCKYER: And if they approve, their approval 
is for some development. 

MS. PHARES: Uh-huh, because there's — this is land 
which has been farmed since the early 1900s. 

CHAIRMAN LOCKYER: And your interest is what? It's 
something that would be advanced or benefited if the approval 
occurs? 

MS. PHARES: No. 

CHAIRMAN LOCKYER: Doesn't matter either way? 

MS. PHARES: No. It's not my problem. I don't own the 
property. He just owes me money. Much like a banker or a 
mechanic's lien. 

CHAIRMAN LOCKYER: I understand, but is there a lesser 
or greater likelihood or getting repayment depending on what the 
zoning decisions might be? 

MS. PHARES: I almost hate to admit this in a public 
hearing, but I am so over encumbered. I mean, the property is 
worth so much more than what I'm owed that it doesn't make any 
difference as far as I'm concerned. 

CHAIRMAN LOCKYER: So, for your interest, you'd get 
satisfied regardless of what they did. 

MS. PHARES: That's right. 

CHAIRMAN LOCKYER: It's not a property in a 
conservation planning area. 



28 

MS. PHARES: No. As I said, it's been farmed since the 
early 1900s. 

CHAIRMAN LOCKYER: Other questions from Members? Then 
I think we'll take testimony from those who wish to express 
concerns or raise questions. Any other questions. 

You can either stay there or step back. We do both. 
We're going to probably hear some people that will tell us why 
we should vote yes or no. You can stay and kind of pinch them, 
or whatever. 

Let's ask if there's anyone present who wishes to say 
something on the positive side. Actually, we can take people on 
either side of the issue that would recommend either 
confirmation or not. Anyone present? 

SENATOR BEVERLY: Go right ahead. 

MR. MERAL: Thank you, Senator Beverly. 

Mr. Chairman, Members, I'm Jerry Meral . I'm the 
Executive Director of the Planning and Conservation League. I'm 
testifying on behalf of ourselves and also for the Mountain Lion 
Foundation. 

We regretfully must oppose Ms. Phares' nomination for 
this position. I do so reluctantly, because generally we would 
prefer to support the Governor's appointees. I've had many 
opportunities to do that before this Committee. This is only 
the third time in fourteen years, in fact, that I've actually 
appeared before this Committee in opposition to a nominee, but 
we feel strongly about this one. 

The principle problem we have with the nomination is 
the lack of Ms. Phares' background in the actual job. This is 



29 

the primary conunission that is responsible for the preservation 
of the public trust resources of the state and fish and 
wildlife. We have a large variety of species. We have 
enormously important hunting and fishing resources, and we would 
like to see people on the Commission who know something about it 
when they are appointed. 

There's nothing wrong with learning on the job to some 
extent/ but when the appointees know virtually nothing about the 
subject matter on commissions of this importance, and relatively 
small commissions — this is only a five-member commission — 
and long-lived appointments -- these are six-year 
appointments — we believe there should be more background and 
knowledge than this appointee has. 

Secondly, despite her statement that there is no 
conflict with respect to the property on which she has a lien, 
this property is generally within the area that would be 
regulated by the various habitat conservation plans that are 
being considered in San Diego. We believe that this is a 
conflict of interest, and that if she was forced to vote on 
listing of species that were in this area, she would have a 
conflict of interest. But more importantly, I think it could 
color her votes on a wide variety of issues before the Fish and 
Game Commission. We believe that is an irreconcilable conflict. 

In our interview, as Senator Lockyer mentioned, her 
view at the time, at least as expressed to us, was that economic 
considerations could be taken into account when voting on 
whether a species should be preserved in California. And while, 
of course, we know that the economy of the state is foremost in 



30 

foremost in most people's minds, the Fish and Game Commission is 
supposed to make its decisions based on scientific evidence. 
That is not/ apparently, at least at the time, what she believed 
was primary in terms of deciding these kinds of matters. 

Finally, I would also like to mention the question of 
the public trust. The Fish and Game Commission preserves trust 
resources. These are things that are owned by all the people. 
The fish, the wildlife, these are things owned by the people of 
the state. 

In our interview, Ms. Phares did not express any 
concern about this particular aspect of the job, which, in our 
view, is the number one reason why we have a Fish and Game 
Commission. We wouldn't need a commission if people could just 
go out and take fish and wildlife without any concern about the 
fact that they're owned by the voters of the state. We think 
that in our interview, her concern on this matter was minimal, 
to say the least. 

So, we very much regret that we must oppose her, but we 
do so vigorously and urge that she not be approved by this 
Committee. 

SENATOR BEVERLY: Any questions of Mr. Meral? 

Thank you, sir. 

Anybody else wish to appear for or against the 
appointment? Is someone coming forward? Apparently not. 

Would you like to respond to the points raised by 
Mr. Meral? 

MS. PHARES: I haven't talked to Mr. Meral before, and 
he was not present in the interview which I have been in. So, 






31 

some of his information is coming second-hand. There may be 
some miscommunication here as to what I believe and what I don't 
believe. 

SENATOR BEVERLY: You talked to representatives of the 
Planning and Conservation League, but not with Mr. Meral, I 
gather. 

MS. PHARES: Right. 

SENATOR BEVERLY: Any questions? Senator Ayala. 

SENATOR AYALA: I have no questions. 

The witness just indicated that people who serve on 
this commission should be experts and supporters of wildlife 
perservation. 

People with common sense should be able to serve on 
that commission without having to have the expertise that you 
claim. I'm not sure that you have to be an expert on the 
conservation of wildlife in order to serve on that commission 
necessarily. It's probably helpful. 

I think if you have a little bit of common sense, if 
you don't go into the deep end of things, either in terms of 
development or environmentally concerned efforts, I think either 
way, we have to have a balance between ecology and economy. 
Otherwise, I think we've got a lot of problems. 

I'm not necessarily convinced that we have to have 
someone on the commission that has the expertise and supports 
the conservation measures that some people claim that we should 
have. I'd argue for that position. 

SENATOR BEVERLY: What are the time constraints on this 
appointment? We have until October. 



32 

MS. MICHEL: October fifth, so we can put this over. 
SENATOR BEVERLY: Obviously, there's a short 
Committee. It takes three votes. 

We'll take the matter under submission and hold it over 
for future action. 
Thank you. 

[Thereupon. This portion of the 
Senate Rules Committee hearing was 
terminated at approximately 3:51 P.M.] 
--ooOoo — 



33 



CERTIFICATE OF SHORTHAND REPORTER 

1, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California, do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 

^ IN WITNESS WHEREOF, I have hereunto set my hand this 

Jl. day of (AyUje^^Co^ 1996. 





J^MIZAK^ 
Shorthand Reporter 



307-R 

Additional copies of this publication may be purchased for $3.00 per copy 
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Please include Stock Number 307-R when ordering. 






SEP 1 8 1996 



^HEARING 



^ 



SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 

MONDAY, AUGUST 12, 1996 
2:40 P.M. 



308-R 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 113 

SACRAMENTO, CALIFORNIA 



MONDAY, AUGUST 12, 1996 
2:40 P.M. 



Reported by 



Evelyn J. Mizak 
Shorthand Reporter 



11 



APPEARANCES 
MEMBERS PRESENT 
SENATOR WILLIAM LOCKYER, Chair 
SENATOR RUBEN AYALA 
SENATOR JOHN LEWIS 
SENATOR NICHOLAS PETRIS 

MEMBERS ABSENT 
SENATOR ROBERT BEVERLY, Vice Chair 

STAFF PRESENT 
GREG SCHMIDT, Executive Officer 
PAT WEBB, Committee Secretary 
RICK ROLLENS, Consultant on Bill Referrals 
NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

ELIN MILLER, Director of Conservation 

ANA M. OLIVAREZ, Warden 

California Medical Facility, Vacaville 

FRANK R. SEARCY, President 

Chicano Correctional Workers Association 

JAMES GOMEZ, Director 

California Department of Corrections 

GARY T. ARANT, Member 

California Regional Water Quality Control Board 

San Diego Region 

CHARLES E. BADGER, Member 

California Regional Water Quality Control Board 

San Diego Region 

SENATOR DAVID KELLEY 

MINERVA G. FIGUEROA 

Women Environmental Council (WEC) 

Border Chapter 

GORDON COLOGNE 



Ill 



MARY-ANN WARMERDAM 
California Farm Bureau 
San Diego Farm Bureau 

STEVE HALL 

Association of California Water Agencies 

LAURA HUNTER, Clean Bay Campaign Director 
Environmental Health Coalition 

LEE OLSEN, Chair 

Education and Conservation Committees 

San Diego Council of Divers, Inc. 

MICHAEL D. IREY 

Commercial Mullet Fisherman 

South San Diego Bay 

JOHN C. CANESTRO, Member 

State Building Standards Commission 

ROBERT H. STORCHHEIM, Member 

State Building Standards Commission 

BOB RAYMER, Technical Director and Staff Engineer 
California Building Industry Association 

DON SCHULTZE 

California Building Officials 

ART CARTER 

California Pipe Trades Council 

DANIEL CARDOZO 

California Pipe Trades Council 

GARY PATTON, General Counsel 
Planning and Conservation League 

PETE PRICE 

California League of Conservation Voters 

STEVE LEHTONEN 

Plumbing, Heating, Cooling Contractors 

PHIL VERMEULEN 

California Legislative Conference 

Plumbing, Heating, Piping Industry (CLC) 



INDEX 

Page 
Proceedings 1 

Governor's Appointees: 

ELIN D. MILLER, Director 

Department of Conservation 1 

Motion to Confirm 1 

Committee Action 1 

ANA M. OLIVAREZ, Warden 

California Medical Facility 

Vacaville 2 

Background and Experience 2 

Questions by CHAIRMAN LOCKYER re: 

Toughest Problem or Decision while 

at Vacaville 3 

Witness in Support: 

FRANK SEARCY, President 

Chicano Correctional Workers Association 4 

Questions by CHAIRMAN LOCKYER re: 

Update on Federal Litigation 4 

Result of Compliance Audits 5 

Aging and 111 Inmates 6 

Questions by SENATOR AYALA re: 

Medical Facility for HIV Positive Inmates 7 

Maintenance of AIDS infected Inmates 7 

Problems at Vacaville 8 

Uniqueness of CMF 8 

Sharing Prison Property with Local 

Municipality 9 

Questions by CHAIRMAN LOCKYER re: 

Oldest Prisoner at Institution 9 

Ways to Spend $10 Million at Institution 9 



Comments by JAMES GOMEZ, Director 

California Department of Corrections 11 

Motion to Confirm 11 



Questions of MR. GOMEZ by SENATOR AYALA re: 

Issue of Capacity at Institution 11 

Committee Action 11 

GARY T. ARANT, Member 

California Regional Water Quality Control Board 

San Diego Region 12 

Background and Experience 12 

Comments in Support of Both 

Nominees by SENATOR DAVID KELLEY 14 

Questions of SENATOR KELLEY by 
CHAIRMAN LOCKYER re: 

Application of Term Limits 16 

CHARLES E. BADGER, Member 

California Regional Water Quality Control Board 

San Diego Region 17 

Background and Experience 17 

Questions of Either or Both Nominees by 

CHAIRMAN LOCKYER re : 19 

Expired Permits 19 

Questions of Either or Both Nominees by 
SENATOR AYALA re: 

Circumstances under which Board Would 

Bring Enforcement Action against Violators 

of Discharge Requirements 21 

Companies Board Has Cited and Amount 

of Fines Levied 22 

Questions of Either or Both Nominees by 
CHAIRMAN LOCKYER re: 

Issue of Point Loma Sludge Handling and 

Removal, and Findings of U.S. EPA and 

State Board 24 



VI 



Board's Inability to Become Involved with 

Local Hazardous Waste Task Force and 

Demotion of Investigator 26 

Board's Ruling that San Onofre Power Plant 

Was Not Violating Clean Water Act 27 

Witnesses in Support: 

MINERVA FIGUEROA 

Women Environmental Council, Border Chapter 28 

Questions by CHAIRMAN LOCKYER re: 

Nature of Work 29 

Examples of Clients 29 

GORDON COLOGNE 30 

MARY-ANN WARMERDAM 

California Farm Bureau 

San Diego County Farm Bureau 33 

STEVE HALL 

Association of California Water Agencies 34 

Witnesses in Opposition: 

MICHAEL IREY 

Licensed Mullet Fisherman 

South San Diego Bay 35 

Questions by CHAIRMAN LOCKYER re: 

Number of Years Fishing 37 

Notification of Enforcement 

Authorities 37 

LEE OLSEN, Chair 

Education and Conservation Committees 

San Diego Council of Divers 38 

LAURA HUNTER, Director 

Clean Bay Campaign 

Environmental Health Coalition 42 

Questions by CHAIRMAN LOCKYER re: 

Duration of Beach Closures 48 

Location of Permanent Beach Closures ... 48 

Cause of Oceanside Beach Closure 49 

Responses by Either or Both Nominees 54 



Vll 



Questions of Either or Both Nominees by 
CHAIRMAN LOCKYER re: 

Board's Certification of Dioxin Tests 55 

Issue of Van Tol Dairy 56 

Resumption of Rebuttal by Either or Both Nominees .... 56 

Comments by CHAIRMAN LOCKYER re: 

Postponing Vote on Confirmations 60 

Need for Stronger Enforcement in 

San Diego Region 61 

Response by MR. ARANT 61 

Decision to Postpone Vote 63 

ROBERT H. STORCHHEIM, Member 

State Building Standards Commission 64 

JOHN C. CANESTRO, Member 

State Building Standards Commission 64 

Questions of Either or Both Nominees by 
CHAIRMAN LOCKYER re: 

Plastic Pipe Controversy 65 

Action on CPVC Piping 66 

Current Status of CPVC Piping 66 

Public Hearings on Public Health Risks 

or Impacts of CPVC Use 67 

Questions of Either or Both Nominees by 
SENATOR AYALA re: 

Views on Use of Plastic Pipe in 

Building Construction 68 

Assemblyman Baca's Bill of 1995, 

Providing Authority to Use Plastic Pipe 69 

Questions of Either or Both Nominees by 
CHAIRMAN LOCKYER re: 

Commission's Adoption of Requirements that 
Differed from Uniform Mechanical Code 70 



Vlll 



witnesses in Support; 

BOB RAYMER, Technical Director and Staff Engineer 
California Building Industry Association 73 

Questions by CHAIRMAN LOCKYER re: 

Association's Philosophy on 

Use of Plastic Pipe 74 

DON SCHULTZE, Building Official 

Sacramento County 

California Building Officials 77 

Statements by CHAIRMAN LOCKYER re: 

Letter to Governor Wilson from President 

of B.F. Goodrich, Principal Manufacturer 

of CPVC, Encouraging HCD to Issue Edict 

to Approve Use of CPVC in California 77 

Witnesses in Opposition: 

ART CARTER 

California Pipe Trades Council 78 

DAN CARDOZO, Counsel 

California Pipe Trades Council 79 

Questions by CHAIRMAN LOCKYER re: 



Date of Determination by HCD 

that CPVC Piping Might Have Hazardous 

Health and Environmental Impacts 80 

Letter from MAUREEN HIGGINS 

Regarding EIR 80 

Date When HCD's Legal Counsel 

Concluded Draft EIR was Inadequate 81 

GARY PATTON, General Counsel 

Planning and Conservation League 83 

PETE PRICE 

California League of Conservation Voters 85 

Questions by CHAIRMAN LOCKYER re: 

Assembly Bill 151 (Baca) 86 

Narrowing the Scope of the Bill 86 



IX 



STEVE LEHTONEN 

Plumbing, Heating, Cooling Contractors 

of California 86 

PHIL VERMEULEN 

California Legislative Conference of the 

Plumbing, Heating and Piping Industry 87 

Rebuttal Comments by MR. CANESTRO 89 

Rebuttal Comments by MR. STORCHHEIM 91 

Comments by CHAIRMAN LOCKYER re: 

Disturbed by Apparent Political 

Motivations on Approval of CPVC 92 

Concern about Length of Terms 93 

Motion to Hold Both Nominations in Committee 93 

Committee Action 94 

Termination of Proceedings 94 

Certificate of Reporter 95 



P-R-0-C-E-E-D-I-N-G-S 
— ooOoo — 

CHAIRMAN LOCKYER: The next one is Elin Miller, the 
Director of Conservation. We had a lengthy interview with her, 
you may recall. I believe it was Senator Costa that had brought 
her to the Committee and had nice things to say on her behalf. 

I think that some of the Members of the Senate who had 
expressed concerns that had to do with conservation perhaps have 
had those matters addressed. I'm unaware of Member opposition 
at the current time. 

So, this is before us for a vote only. Would there be 
any questions, Senator Petris or Ayala, that you wish staff to 
help with? We don't have the appointee. 

SENATOR PETRIS: Move. 

CHAIRMAN LOCKYER: We have motion to confirm, or to 
recommend that to the Floor. Call the roll, if you will. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. Senator 
Petris. 

SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. Senator 
Lockyer . 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Three to zero. 

CHAIRMAN LOCKYER: I think maybe a lot of the people 
who are present are here for the Warden at Vacaville. Maybe 
we'll be able to free up a few seats and create some room if we 



do that one/ number five on our file. 

Hi. 

MS. OLIVAREZ: Hi. 

CHAIRM7VN LOCKYER: How do you like this job? 

MS. OLIVAREZ: I love it. 

CHAIRMAN LOCKYER: Why? It's supposed to be hard. 

MS. OLIVAREZ: First of all, I want you to know, about 
half the people that are here with me are my family. 

CHAIRMi^N LOCKYER: That's good, no overtime. 

MS. OLIVAREZ: No overtime. 

CHAIRMAN LOCKYER: Do you want to tell us a little 
about your experience in the system? 

MS. OLIVAREZ: Certainly, thank you very much. 

I am Ana Olivarez. I was appointed to the position of 
Warden at the California Medical Facility effective January 
first of this year. 

Prior to that, I was the Warden at the Dueul Vocational 
Institution in Tracy, California. I was there for about three 
and a half years. So, I've been a warden for just over four 
years . 

I've been in state service since 1973. 

CHAIRMAN LOCKYER: What does it mean. Acting Warden, 
Department of Corrections, Tracy? 

MS. OLIVAREZ: I was appointed as an interim Warden. 

CHAIRMAN LOCKYER: Is that Dueul still? 

MS. OLIVAREZ: Yes. 

CHAIRMAN LOCKKYER: I thought it was different. 

MS. OLIVAREZ: Oh, no, same place. 



CHAIRMAN LOCKYER: Go ahead. 

MS. OLIVAREZ: I began my state service in 1973, and 
I've worked in a number of different state agencies, but I keep 
coming back to the Department of Corrections. I've worked as a 
correctional administrator in the Planning and Construction 
Division. I worked as an Associate Warden at Folsom Prison. 

CHAIRMAN LOCKYER: Hopefully they don't have much work 
now. 

MS. OLIVAREZ: When I was there, it was quite busy. I 
left there and went to Folsom Prison. I was an Associate Warden 
for programs, and then later Associate Warden for custody on the 
old side. Worked as a Chief Deputy Warden at the prison in 
Susanville, and then went to Dueul . 

I've also worked in state service as personnel manager, 
as a chief of health and safety, and as a governmental program 
analyst. 

CHAIRMAN LOCKYER: Well, you've lived in some of the 
garden spots of California. 

MS. OLIVAREZ: Yes, I have. They actually are very 
nice. Nicer than they sound. 

CHAIRMAN LOCKYER: What's been the toughest problem or 
decision you've made while you've been at Vacaville? 

MS. OLIVAREZ: Well, probably in my first eight hours 
there. When I got there, we were in the middle of a 
tuberculosis incident, and that was quite interesting. That was 
probably the most stressful situation I've had to deal with. 

CHAIRMAN LOCKYER: Are there people present who wish to 
comment for, or perhaps there'll be some questions so we can ask 



for comment. 

I'll note there's no opposition reflected in the file, 
which is nice so that helps. 

MR. SEARCY: Good afternoon, Senator and Committee 
Members . 

I'm Frank Searcy, Chicano Correctional Workers 
Association President. 

At this time, we'd like to offer our support for Ms. 
Olivarez as Warden at California Medical Facility. The 
Association feels very confident that Ms. Olivarez has 
consistently displayed the utmost of her administrative 
abilities. She is a fine person and a fine Warden. 

And as you know, as she has all ready explained to you 
previously also, at this point we feel there's not much more 
that we can add, other than we want to add and repeat that the 
Association does strongly support Ms. Olivarez as Warden at 
California Medical Facility. Thank you. 

CHAIRMAN LOCKYER: Thank you very much. 

Is the there anyone else that wanted to make a comment 
at this time. 

Perhaps I could ask for an update on the federal 
litigation and court orders with respect to psychiatric, mental, 
so on. What do you see happening to resolve those matters? 

MS. OLIVAREZ: Well, we've had some activity here 
lately primarily as a result of the passage of the Prison 
Litigation Reform Act. We did go into federal court and ask 
that the Act be declared applicable to both the Gates consent 
decrees. 



The court has ruled, the federal court at the district 
level, has ruled that that particular piece of legislation is 
not applicable to Gates . 

CHAIRMT^ LOCKYER: Why would that be? 

MS. OLIVAREZ: They determined that Mr. Breed does not 
fit the definition of Master as defined in the Act. So, we are 
— we have elevated our appeal to the Court of Appeals. 

CHAIRMAN LOCKYER: How about getting a different 
Master? Can you get a Master that would fit the Act? 

MS. OLIVAREZ: That — I don't think we've approached 
it from that aspect. 

CHAIRMAN LOCKYER: Isn't Breed a court-appointed 
Master? 

MS. OLIVAREZ: Yes. 

CHAIRMAN LOCKYER: So you could ask for somebody else? 

MS. OLIVAREZ: The issue was, did the Act apply to that 
consent decree, and so no matter who the Master is, does the Act 
Apply? That was the issue that was brought before the court. 

CHAIRMAN LOCKYER: The answer is yes, except you have 
wrong kind of Master. 

MS. OLIVAREZ: The answer was no, because we don't have 
the right kind of Master. 

CHAIRMAN LOCKYER: If you took care of the Master, then 
there might be another reason, I guess? 

MS. OLIVAREZ: Right. That has been appealed. 

I will say that we are audited every quarter on our 
compliance, and we had our most recent audit the first week of 
July. We were found to be in 100 percent compliance. 



CHAIRMAN LOCKYER: Congratulations. 

MS. OLIVAREZ: Thank you. We were also audited this 
month on the CRIPA, which is the Civil Rights of 
Institutionalized Persons Act. And we're audited once a quarter 
on CRIPA, and we were once again — 

CHAIRMAN LOCKYER: Is that federal? 

MS. OLIVAREZ: Yes, it is, and we were in 100 percent 
compliance. We've been in 100 percent compliance for last six 
quarters. So, we're doing okay. 

CHAIRMAN LOCKYER: Can you maybe help us learn about 
aging and ill inmates? 

MS. OLIVAREZ: Well, we have a lot of them. 

CHAIRMAN LOCKYER: How many have you got of those? 

MS. OLIVAREZ: Vacaville is an institution of 3200 
inmates. We are one of four licensed hospitals. We are the 
medical facility for primarily the northern institutions. 

We have — we also have a 500-bed AIDS unit. It's not 
the only AIDS unit in the state, but it is the largest. There 
are several other AIDS units also. 

Our AIDS unit, though, does get the sickest of the 
sick. And we're fortunate that we have some really top caliber 
physicians who specialize in AIDS and in infectious diseases, so 
we're able to handle that very well. 

We have a 17-bed hospice also that is in the same unit 
as the AIDS unit. We're a licensed, 65-bed acute care hospital. 
We also have 150 acute psychiatric beds as part of that license. 

CHAIRMAN LOCKYER: So, something like two-thirds of 
your patients are psychiatric or hospitalized? 



MS. OLIVAREZ: Correct. 

CHAIRM7\N LOCKYER: Or hospital-related commits. 

MS. OLIVAREZ: Correct, the vast majority of our 
inmates are medical or psychiatric related. 

Then the small general population that we do have is 
there primarily as a support. 

CHAIRMAN LOCKYER: Senator. 

SENATOR AYALA: As I recall, Vacaville was the first 
facility or the first institution to have a medical facility for 
the HIV positive inmates. 

MS. OLIVAREZ: Yes. 

SENATOR AYALA: Am I correct? 

MS. OLIVAREZ: Yes. 

SENATOR AYALA: You have them in other institutions? 

MS. OLIVAREZ: We have them at Chino and Corcoran. 

SENATOR AYALA: Do you just maintain these? Since 
there's no cure, do you just maintain these inmates while 
they're in that facility? 

MS. OLIVAREZ: Actually, they're involved in drug 
therapy, and also we're — we monitor their nutrition. And we 
have psychiatric and social work support. 

So, I would like to think that it's more than 
maintaining. 

SENATOR AYALA: You're maintaining them. Are they 
really improving their medical status? 

MS. OLIVAREZ: Well, certainly if they ~ AIDS is a 
terminal disease, so what you hope for is to relieve pain and to 
prolong life, and I think we're being successful to that end. 



8 

SENATOR AYALA: Are there any special problems at 
Vacaville that you'd like to tell the Committee about? I know 
you're over-crowded, and all those sort of things. What is 
happening at Vacaville that you'd like to tell us? 

MS. OLIVAREZ: I'm sure every Warden would get up here 
and say, we need more money. 

CfiAIRMAN LOCKYER: More money. 

MS. OLIVAREZ: Every Warden would get up here and say 
we need more money. 

I really can't think of anything in particular that I 
would want to bring to your attention. 

SENATOR AYALA: When you look at one institution, 
you've seen them all, right, in terms of problems? 

MS. OLIVAREZ: No, Vacaville is absolutely in unique. 
We're not like other institutions. 

SENATOR AYALA: Why is it unique? 

MS. OLIVAREZ: Because we are a medical facility, and 
we're not a programming prison. 

When I was Warden at DVI, my biggest problems were 
getting people to school, getting them to work. My biggest 
medical problem had to do with things related years of drug 
abuse . 

As opposed to being in Vacaville, my biggest headaches 
are making sure that the medical attention and psychiatric 
attention is being given to the inmates. Making sure that we 
have people properly diagnosed and in the right treatment 
programs. It's totally different than trying to get people into 
work and school and that kind of thing. 



SENATOR AYALA: I also recall that Vacaville was the 
first institution to share their property with a local 
municipality. They provided a Little League field/ as I recall. 
I came over to see how that worked many years ago. As I recall, 
that was the first facility to share their property with city 
and work together to provide services for the general public. 

MS. OLIVAREZ: Right. And those baseball fields are 
still working. They're still playing baseball on those fields. 

SENATOR AYALA: That's all. 

CHAIRMAN LOCKYER: Do you have any vacas still? 

MS. OLIVAREZ: Any vacas at Vacaville? No, I don't. 

CHAIRMAN LOCKYER: No cows. 

What's the oldest prisoner you have? How old? 

MS. OLIVAREZ: Well, I recall meeting someone in 
Classification Committee who was about 80. 

CHAIRMAN LOCKYER: Pretty dangerous guy, I guess? 

MS. OLIVAREZ: Pretty crazy guy. 

CHAIRMAN LOCKYER: Hang on to him then. 

If I could give you $10 million that you could use 
discretionarily tomorrow during this next year, how would you 
spend it? 

MS. OLIVAREZ: I would probably spend it on upgrading 
our equipment and perhaps doing some retrofitting of cells. 

CHAIRMAN LOCKYER: What kind of equipment? 

MS. OLIVAREZ: I would improve our medical equipment. 
There's always new technology. As soon as you buy something, 
it's obsolete. There's something better on the market. 

CHAIRMAN LOCKYER: Retrofitting cells in what way? 



10 

MS. OLIVAREZ: Well -- 

CHAIRMAN LOCKYER: Inside? 

MS. OLIVAREZ: The facility was built in — it was 
opened in 1955. 

CHAIRMAN LOCKYER: So, like remodeling. 

MS. OLIVAREZ: Right. 

CHAIRMT^ LOCKYER: Interior decorating? 

MS. OLIVAREZ: Actually, I would try to improve because 
technology has improved since 1955. 

CHAIRMAN LOCKYER: But do you mean the bars and the 
electronics? Or, no, you mean the insides. 

MS. OLIVTUIEZ: Right now, we don't have electronics. 
We've got keys. 

CHAIRMAN LOCKYER: That's right, you have the big 
gates. But that's the kind of stuff? 

MS. OLIVAREZ: Right. 

CHAIRMAN LOCKYER: But you don't have the Eureka 
problem of guys walking around. They figured out how to open 
those. Pelican Bay. 

MS. OLIVAREZ: Oh, no, I don't. That is one consoling 
thing about the old-fashioned way. When you lock it, you know 
it's locked. 

CHAIRMAN LOCKYER: Okay, other questions from the 
Members. 

Mr. Gomez, I note you're here as you typically are, 
being a loyal manager supporting your staff. But if you want to 
give a speech, you can. If you would like us to just vote aye, 
we'll do that. 



11 

MR. GOMEZ: I'd take the ten million and put it into 
substance abuse treatment and keep running the facility. 

CHAIRMAN LOCKYER: I'm glad you got a commercial in, 
thank you. 

What's the pleasure of the Committee? 

SENATOR LEWIS: Move confirmation. 

SENATOR AYALA: Can I ask Mr. Gomez a question? 

Mr. GomeZ/ is this the only facility that has less 
inmates that capacity can handle? 

MR. GOMEZ: It has some court orders that limit the 
capacity of what it can have, but it's still fairly crowded. 

I think it's about the only institution in the state 
with a gymnasium that is available, where, you actually have a 
gymnasium. When you have as many psychiatrically ill and as 
many people with HIV there, I think the conditions are 
appropriate, and we've not pushed the court to try and 
particularly relieve this one. 

It's the most complex facility in the state. I think 
Ana's done a real good job having to run the most difficult. We 
asked her to go there from DVI because it's a tougher facility 
to run. 

CHAIRMAN LOCKYER: Our notes say it's 136 percent of 
capacity, which I guess is pretty good as these numbers go. 

MR. GOMEZ: Pretty good. 

CHAIRMAN LOCKYER: We have a motion to confirm. 

May I record the four of us voting Aye? That'll be it. 

Thank you very much. Good luck. 

MS. OLIVAREZ: Thank you very much. 



12 

CHAIRMAN LOCKYER: We have a couple members of the San 
Diego Regional Water Quality Board. I guess we'll take both at 
the same time, if Mr. Badger and Mr. Arant are available. 

Come on up, gentlemen. 

CHAIRMAN LOCKYER: Hi. 

MR. ARANT: Hi. 

CHAIRMAN LOCKYER: I'm trying to save a little time, 
but it probably won't work. 

I guess Mr. Arant, starting alphabetically, if you want 
to go first, sir. 

MR. ARANT: Good afternoon, Mr. Chairman and Members of 
the Committee. My name Is Gary Arant. I'm Chairman of the San 
Diego Regional Water Quality Control Board. 

I'd like to thank you for the opportunity to be here 
today to talk to you about my qualifications for appointment. 
If you've reviewed the materials I've forwarded to the 
Committee, you realize that I have served three terms on the 
Regional Board. 

In that 12-year period, I've had many opportunities to 
use my 23 years of experience as a water resource professional 
to deal with a number of problems, issues, enforcement actions, 
and to come up with what we feel to be consistently effective 
responses . 

Beyond the realm of permitting, and monitoring, and 
enforcement activities, I'm rather proud of our Board's record 
in several areas that I think will lead to long-term water 
quality enhancement. Water recycling, our region has always had 
a strong emphasis on recycling of waste water. Through 



13 

recycling, we reduce the amount of discharge to water bodies, 
specifically the ocean, and we make maximum use of imported 
water that comes to our region. 

We're working on an interesting permit right now. That 
happens to be the Santa Margarita River live stream discharge 
permit. It'll be a two MGD demonstration program. We're 
excited about that. 

San Diego Bay, we have been involved in the Bay in many 
ways. One of the positive ways from the standpoint of 
developing long-term solutions to water quality enhancement is 
through the Bay Panel, developing and trying to develop a 
comprehensive Bay water monitoring program, and incorporating 
the capabilities of the Super Computer at UCSD. We think that 
will lead to some long-term improvements. 

We've been coordinating with land-use agencies, trying 
to get them to incorporate land use policies that will improve 
water quality by preventing storm water runoff to storm water 
pollution. 

We are just now getting to watershed management. We've 
had a history at the Region Nine Board of using the opportunity 
to take fines, instead of sending them to Sacramento, having the 
discharger develop enhancement programs in the region, 
remediation programs and enhancement programs. 

As I say, I'm proud of our record in many areas. But 
as you understand, not everybody agrees with my assessment, and 
I have been formally opposed by the Environmental Health 
Coalition. 

Over the years, the EHC has consistently been what I 



14 

would call an energetic and a well-informed advocate of their 
membership's point of view on many critical environmental 
issues. Believe me when I say that they, in my mind, are an 
integral part of our regulatory process. Their input is noticed 
and is important to our Board, our Board staff, and the 
regulated community. 

This is my fourth term on the Board. This is the first 
time I've been challenged by any group, including EHC. I was 
somewhat surprised at this juncture that I was being challenged. 
Nevertheless, in their letter to you dated April 4th, 1996, they 
cited several reasons for opposition, and I've drafted responses 
to each one of those. 

But in summary, I really believe that the basis of 
their opposition is tied to an honest and inherent difference 
between their focused perspective and function as an 
environmental advocate and the broader based purview and 
responsibility of our Board as an environmental regulator. I 
believe the existence of those differences is essential for 
maintaining an open, and balanced, and effective regulatory 
process . 

I'm looking forward to your questions. 

CHAIRMAN LOCKYER: Perhaps let me first acknowledge 
Senator Kelley. 

Senator, we got the engine going here before you got 
out of the garage, but why don't you make any comments that you 
would wish to at this point. 

SENATOR KELLEY: Thank you, Mr. Chairman. I appreciate 
the opportunity to speak to the Committee today with respect to 



15 

the two gentlemen that you have before you regarding the 
appointment to the Regional Water Quality Control Board in San 
Diego. 

Let me just state that I have worked with both of these 
gentlemen for a quite number of years as it comes to the water 
issues that we address in San Diego County, as well as some of 
the other areas around the State of California. 

One of the issues, as you are well aware, I carried the 
legislation here that addresses water reclammation and water 
conservation programs within the State of California. And the 
water district that is in the northern part of the County of San 
Diego is very supportive of this type of legislation. They 
implement the process with regards to the use of reclaimed water 
on the orchards, the avocado and the citrus orchards in this 
part of the county. 

Mr. Badger and I, not to belittle the fact too much, 
but we attended college together, and we've known each other for 
many, many years. We happen to be in the same business, which 
is the citrus business, so we've worked together over many, many 
years on the issues as it pertains to water, and the fact that 
this is a key ingredient as far as the economy of San Diego and 
other counties in Southern California are concerned. 

These gentlemen are well-qualified for the position. 
They have tremendous experience to the bring to the position, 
and I strongly recommend your reappointment of both of them to 
the Regional Board. 

Thank you, Mr. Chairman. 

CHAIRMAN LOCKYER: Senator, one of the issues is 



16 

whether term limits, in its wisdom, ought to apply to jobs like 
this. We have people that are starting in their 11th or 13th 
year of service with some number of years ahead. 

What do you think? 

SENATOR KELLEY: Well — 

CHAIRMAN LOCKYER: It applies to you and others. The 
question is if there shouldn't be a maximum amount of time that 
people are on these type of jobs? 

SENATOR KELLEY: Sometimes it's rather difficult to 
find individuals that will sit on these boards because they're 
more or less — they're very time consuming and demanding. The 
knowledge that you have to have is rather narrow in scope for 
what the issues are that they're addressing. It's going to be 
complicated to find someone that has the background and 
experience, and is willing to sit on these boards because of the 
time involved and the nature of the subject matter that's 
brought before them. 

But I would think that that would be up to someone at 
the local level as to whether they should impose some sort of a 
restriction on the terms that they would serve, the number of 
terms that would be available to them. 

I personally, as we look at the experience that we're 
going through here in the Legislature, what is happening, I'm 
not sure that that's the wisest course of action. But here 
again, we haven't experienced that long enough here in the 
Legislature. We do know what is happening today, but we don't 
know what it's going to be like, say, five or ten years from 
now. 



17 

CHAIRMAN LOCKYER: Thank you. Senator. 

SENATOR KELLEY: Thank you. I appreciate it. 

CHAIRM7\N LOCKYER: Thank you. Senator. 

We heard you went to college together. We didn't hear 
whether you were roommates or something. 

MR. BADGER: No. 

CHAIRMAN LOCKYER: We didn't hear the really good 
stuff. 

Maybe an opening would be appropriate. We'll shift to 
Mr. Badger. 

MR. BADGER: Thank you, Mr. Chairman, other Members of 
the Committee. 

My name is Charles Badger, and I reside at 253 Via 
Tierra, Encinas, California. I currently am the Vice Chair of 
the Ninth Regional Water Quality Control Board, San Diego 
Region. 

I also, as Gary, am appearing before you again for the 
first time, but this is the fourth term I would serve. I've had 
shortened terms to correct the imbalance in the position to 
which I was appointed. At the present time, I serve as the 
irrigated agricultural representative on this Board. 

My background, my university, I hold degrees in plant 
pathology and entimology, and I have a citrus grove management 
service business in the central north part of San Diego County. 
I manage approximately a thousand acres of citrus and 
pasturage. 

My background and training uniquely qualifies me for a 
position such as this, especially regarding agricultural 



18 

chemicals. My formal training is chemistry, and plant 
biochemistry, and organic chemistry, and so on and so forth. 
I've also done research work at the Citrus Experiment Station, 
University of California at Riverside for number of years before 
I started in working in my dad's business. 

Integrated pest management is a term that is now very 
much in vogue, and that is something that is — that we have 
developed over the years. In fact, my dad started doing this in 
1930, the year in which I was born. In the citrus industry, we 
first brought in our vidalia lady bird beetles in 1885, it was, 
middle 1880s, and we have found out a long time ago that you 
don't have to use chemicals to maintain pest control in citrus 
orchards . 

. I have served as the President of the San Diego County 
Farm Bureau, the past President of the California Pest Control 
Operators. I was involved in some of the basic research work at 
the UCR, developing testing of fertilizer requirements for 
plants by using plant tissue as well as soil testing, which has 
cut the use of nitrogen fertilizers to a tremendous degree, 
thereby protecting water quality in the aquifers that lay 
underneath the citrus groves. 

I do agriculture pipe line design engineering, figuring 
hydraulic lines, the way to install pipe lines and sprinklers. 
In San Diego County, agriculture uses 17 percent of the water 
that is used in San Diego County. We have developed some of the 
most outstanding methods and ways of irrigating agricultural 
crops and still return in excess of one billion dollars of 
income to the County of San Diego. 



19 

The pest control operations that I do, we use no 
Category I or II chemicals to spray trees with. We feel that 
our employees must be protected. We have been very fortunate 
that we can do this with the amount of other works we do, with 
release of the predators and predatious insects. 

I have the marvelous opportunity to bring this 
experience, the life-long involvement with the chemical 
industry, to a board such as this to protect the waters of the 
State of California, and to serve both the citizens of the 
state as well as my peers in the agricultural community. 

CHAIRMAN LOCKYER: Thank you, sir. 

Let me ask either of you to comment on the contention 
that major sources of industrial waste have had permits expired 
for any number of years. The one I hear is San Diego Gas and 
Electric, but there are some others, I think, that five, six 
years, no permit. 

What's that all about? 

MR. ARANT: I responded to that issue, and the response 
is on the goldenrod color. 

It is true that we have had a backlog of expired 
permits, but let's be clear that expired permit, the 
expirations, the renewal date, the permits are still in force. 
They need to be updated. 

We have, through a concentrated effort, reduced our 
backlog of expired permits by 47 during fiscal year '94-95. We 
anticipate eliminating all backlog permits by December of this 
year. 

But my general comment on that, and over the years of 



20 

being a Board member, is that if we focus our resources on 
bringing forward expired permits, then necessarily something 
else will have to be left without the kind of attention it 
needs, and then we will be criticized because we have not done 
adequate inspections or adequate enforcement. We will then 
refocus on something else, and then the thing that we reduced 
emphasis on lags behind, and then we're criticized. 

So, the challenge becomes allocating your resources to 
deal with always constantly competing priorities. 

We have made a concerted effort to bring forward those 
permits. I would say that the San Diego permit, we are working 
on it. We have been diligently trying to bring closure on that 
permit. It involves the South Bay Power Plant. It is a very 
complicated issue. It involves very strong differences of 
opinion about environmental impacts. 

It's a very difficult job to bring closure on all these 
issues if you can, but we are working on it. We spent about 
three hours on it at our last Board meeting last Thursday. So, 
it's an issue that we will bring closure to in the next month or 
so. 

CHAIRMAN LOCKYER: Did you want to add anything, sir? 

MR. BADGER: In my number of years on this Regional 
Board, I am so extremely pleased at this point in time of what 
our Regional Board is doing regarding the closure of some of 
these age-old permits, these NPDES permits held over so long. 

We did close up 47 of the 53 that are outstanding. We 
have five left, and those should be closed by this December at 
the latest. All of them, I feel, will be closed. 



21 

CHAIRMAN LOCKYER: Are there questions from Members? 
Yes, Senator Ayala. 

SENATOR AYALA: Yes, I'd like to dwell into that 
question about the San Diego industries violation of the 
rules. 

Under what circumstances would you bring an enforcement 
action against violators of discharge requirements? 

After you folks visited with me this morning, I had a 
couple people come in and tell me that you were not enforcing 
the laws. Some people are getting off the hook without any 
reason at all. 

What is the policy that you have in terms of enforcing 
actions against violators of the discharge requirements? 

MR. ARANT: We took some time to address that. It's 
under the light gray sheet in my presentation. 

The Board takes many types of enforcement actions. 
Many of them are informal. In other words, they are handled by 
the staff with a phone call or a letter, and the issues are 
corrected. 

Many of the actions do find their way to the Board. 
As a matter of fact, between January 1 of 1994 and January 1, 
1996, we took 61 formal enforcement actions. We currently have 
on the books about $1.5 million, depending on how you count it, 
in fines, and in lieu of fines, mitigation programs in the 
region. 

So, I would say that I would take issue with the 
allegation that we don't enforce. 

Our policy, my view of the policy is that we look at 



22 

State Board guidance on the enforcement policy, which I think I 
described in pretty good detail in my letter to you earlier this 
year. We try to avoid fines. We try to get compliance through 
cooperative means, but when it does come time, when we see 
repeated violations, or we see recalcitrance on the part of the 
discharger, then we will resort to administrative civil 
liabilities. Those have resulted in fines. Sometimes they even 
find their way to the Attorney General and resolution in that 
venue. 

We have had several issues go to court and to be 
resolved in the courts. 

In my view, it's typically where we have repeated 
violations, or we have a discharger who is making no real effort 
to try to correct the problem that is creating the discharge or 
the violation. 

SENATOR AYALA: Can you name any companies that you 
have ordered to cite for major violations, and the amounts that 
they've been fined? 

MR. ARANT: Well, the most recent one was the City of 
San Diego, where we had essentially two separate issues that we 
resolved with one settlement. The total value of the settlement 
was $1.35 million. 

SENATOR AYALA: City of San Diego? 

MR. ARANT: City of San Diego, one million of which 
will be utilized for monitoring in San Diego Bay, monitoring in 
coastal waters, a pretreatment program, and so forth. And we 
think these are important — and wetlands restoration project 
within the region. $350,000 will come to Sacramento to the 



23 

Cleanup and Abatement fund, which will be used statewide for 
various cleanup programs under the directorship — 

SENATOR AYALA: Any major companies in that area that 
you've cited. 

MR. ARANT: I have a list of companies that we have 
enforcement actions against: Bay City Marine, Campbell 
Industries, Chevron, USA Products, City of Chula Vista, City of 
San Diego, Solarcraft, Lakeside Land Company, Nielson-Beaumont 
Marine, Rainbow Municipal Water District, San Diego Unified Port 
District, County of San Diego Solid Waste Division. 

SENATOR AYALA: These are agencies. Do you have any 
private industries? 

MR. ARANT: Yes, the boatyards that I just named were 
private companies. Teledyne, Ryan Aeronautical, U.S. Marine 
Corps. 

SENATOR AYALA: Marine Corps. 

MR. ARANT: Camp Pendleton has a number of 
environmental problems on the base: leaking underground storage 
tanks, sewage treatment plants that must be brought up to 
standard. So, there's a number of issues. 

But we've involved a number of private companies and 
public agencies in various forms of enforcement. 

SENATOR AYALA: Thank you. 

MR. BADGER: Senator, too, I would like to add that on 
some of these issues, I have been the Board Member who was — 
been somewhat different. I've tried to hold out for higher 
fines, specially regarding the City of San Diego. They have 
been way overboard, and way out of bounds in some of the actions 



24 

they have taken. 

At our meeting when we accepted the $1.35 million, I 
finally voted the rest of my Board members, because they had a 
City Councilwoman get up and admit they had done wrong, and had 
put in at that time 500-some million dollars, of which they have 
spent about 260 million now to upgrade their sewage 
infrastructure within the Metro Sewage District. 

So, they are cleaning up their act. I think we finally 
got their attention with this thing. And I reluctantly voted to 
support my fellow Board members at that time. 

CHAIRMT^ LOCKYER: I'm looking at a document from March 
of '93, U.S. EPA issued a finding, a violation for the City not 
having implemented a pretreatment program regarding industrial 
users. Lots of complaints in the communication. And then, 
shortly after that, a couple months later, the State Water 
Resources Control Board sends a memo that says, "It's my 
understanding your staff has now determined the City may have 
violated numerous discharge requirements in 28 of the last 60 
months . " 

Now, that was spring of '93. This is Point Loma, I 
guess, one of the issues. 

Had the issue been raised before the Board prior to the 
state and federal environmental and water agencies bringing it 
to your attention? 

MR. ARANT: I don't recall the sequence of events. I 
do believe that the issue of Point Loma, and how the sludge 
handling and sludge removal were reported, later became the 
subject of an administrative and civil liability, which was 



25 

ultimately resolved in the settlement that we just completed in 
February of 1996. • - 

MR. BADGER: Senator, at our Board meeting on September 
the 27th, 1993, held in the City of Chula Vista, this was an 
issue at our meeting. It was involved also with the EPA lawsuit 
we were involved with against the City of San Diego, and a Judge 
Brewster had much of this going on at the time. We couldn't 
really get involved in it at that time. 

But then, when the sludge thing came up, I felt that it 
had gotten so far out of hand that we needed to put it into the 
District Attorney's hands in the City or County of San Diego, 
one of the two. I have a copy of the minutes there, the audio 
minutes that shows I asked those questions. 

And also, the City Attorney then comes up and tries to 
get another delay. I kind of treated him maybe a little badly. 
I told him, if he worked for me, I'd fire him if he kept 
continually trying to get delays. 

The frustration I felt over this whole issue at that 
time was just — to me, it was beyond measure. That's why, 
again, we probably should have fined them more. 

I found one thing in this job. It's certainly 
frustrating. They just don't seem to pay attention sometimes, 
and we need to get their attention. 

CHAIRMAN LOCKYER: That's sort of how we feel up here 
sometimes, too. 

I note that the year before, '92 in this instance, 
there's a newspaper article that talks about the local Hazardous 
Waste Task Force. Apparently, they decided to not invite the 



26 

Water Quality Board anymore because they thought it didn't 
really help to have them involved. • • 

And I guess there was a specific issue regarding an 
investigator that was demoted because he was a whistle-blower, 
according to the newspaper story, and turned in some polluter. 

Does any of that ring a bell? What was that all about 
in your view? 

MR. AR?^T: Well, I think I tried to address that in 
the green sheets in our presentation. 

As I recall the issue, the issue had to do with not 
whether or not it was a good idea for Regional Board to be 
involved with the Strike Force. It had to do with the level of 
control that the Strike Force wanted over our employees from the 
management level and from the Board level. It also had to do 
with the issue of leaving the Regional Board out of the loop. 

In other words, we were often told that we were — we 
would not be informed on some of these enforcement actions. 

The issue with the employee had to do with the employee 
following through on some directions from the Task Force that 
were in direct contradiction to the directions of our Executive 
Officer. 

There were some other issues involved. That, I think, 
is what led to the split, if you will, where we were informed by 
the Strike Force that we would no longer be involved. 

I would like to say, though, that today at this 
juncture, we are involved with the federal government and 
enforcement actions. As a matter of fact, we have taken part in 
two recent enforcement actions, one in San Bernardino County, 



27 



and one in Orange County. 

Our Regional Board officer and some staff members have 
taken training from the federal government on enforcement. I 
believe he's the only one in the state that's undergone that 
training. 

SO/ I think we've resolved some of those issues. We 
are involved with the federal government in these types of 
investigations. It's a much more comfortable relationship. 

CHAIRMAN LOCKYER: Let me ask you to comment briefly. 
I'm sorry to sort of shot-gun it here, but I'm trying to give 
you a benefit of various articles we've accumulated to comment 
on. 

Another is San Onofre, where the Board ruled that the 
power plant was not violative of the Clean Water Act. Now, this 
story indicates that that was despite recommendations from your 
own staff and the conclusion of the Marine Review Committee that 
spent 15 years and $50 million documenting what it claims to be 
the major impacts. 

Any comment on that? 

MR. BADGER: Yes, Mr. Chairman. 

I Chaired those meetings. We had testimony from 
representatives of the power plant people at Songs, from some of 
the most imminent people within their fields in the United 
States. And on the other hand, we had testimony from other very 
imminent scientists within their fields, identical fields from 
the other side. We were faced with a dilemma at this point. I 
remember it turned on a — 

CHAIRMAN LOCKYER: It turns out experts have values. 



28 

MR. BADGER: For both sides. It was something. 

But it turned on, in my mind, at a juncture when one of 
our Board members asked about the amount of kelp that had been 
destroyed because the plant was there. He asked this question 
because, about four years prior to our meetings, there was a 
severe storm that wiped out the kelp. And it had recovered to 
such an extent that the kelp was then being — while we were 
holding our meetings, was then being commercially harvested from 
those kelp beds. So, our Board members didn't feel that there 
could have been much damage by the Songs' operation to destroy 
that kelp if, in fact, they were commercially harvesting it at 
that date. 

CHAIRMAN LOCKYER: There probably will be more 
questions. Maybe we ought to take a little testimony, if you 
gentlemen can give us room here. 

Anyone present who wishes to comment either for or 
against on either side? Let's take the for first, the 
supporters. 

MS. FIGUEROA: Hello. Thank you for the opportunity to 
speak here today before you. 

My name Minerva Figueroa, and I represent the Women 
Environmental Council from San Diego. We are the Border 
Chapter, and we're divided in other chapters in Orange County 
and L.A. 

CHAIRMAN LOCKYER: What's the chapter? 

MS. FIGUEROA: Border. It's called Women Environmental 
Council, Border Chapter. 

Our organization is a group of professional 



29 

environmental women that get together in order to have an open 
forum for fair and safe arena to discuss several issues that 
have to do with contamination in the environment in the border, 
basically. 

We have seen several efforts from Mr. Gary Arant as for 
working with binational and — binational problems along the 
border, putting efforts into problems that have to do with waste 
that locally we are very concerned about. We have seen his 
credentials, and we believe that after 20 or so years working in 
the field, he's a very qualified candidate. 

And my presence here is just to respectfully urge you 
to reappoint Mr. Gary Arant for that position. 

CHAIRMAN LOCKYER: Ms. Figueroa, let me ask you to tell 
me a little about the nature of your work so I can understand 
the kind of group you have. 

MS. FIGUEROA: I'm an environmental consultant, and I'm 
part of the Women Environmental Council in San Diego. 

CHAIRMAN LOCKYER: So, are you an independent business, 
or do you work — 

MS. FIGUEROA: I'm an independent consultant. 

CHAIRMAN LOCKYER: Who would be an example of a client? 

MS. FIGUEROA: For my company? We work for — we offer 
research information for Natback, for example, and Beck, which 
are international organizations that are designed to find 
accurate and honest data to evaluate projects along the border. 

We provide official census and official statistics of 
health, environmental pollution, demographic and economic data 
in the border, so they can make a good assessment whether a 



30 

project should be approved or not. 

CHAIRh4AN LOCKYER: Were these government organizations 
you mentioned? 

MS. FIGUEROA: That is correct. They're binational — 
well/ they're confirmed by — 

CHAIRM7\N LOCKYER: By treaty or whatever? 

MS. FIGUEROA: By officials representing each country. 

CHAIRMAN LOCKYER: How about in the private sector? 
Would you have clients of that sort as well? 

MS. FIGUEROA: We have not had any private clients in 
that sector yet . 

CHAIRMAN LOCKYER: Thank you very much for being with 
us . 

Mr. Cologne. 

MR. COLOGNE: Gordon Cologne. I'm here to support both 
these candidates. 

Let me explain that up until about two years ago, I 
lived in north San Diego County. First of all, I should explain 
that Mr. Badger is a ranch manager and did handle our lemon 
grove for us. And I watched his operation, I know that he is 
not an advocate of using pesticides and so forth. He's a very 
strong person as far as the environment goes. 

CHAIRMAN LOCKYER: You have a lemon grove? 

MR. COLOGNE: Yes, I had one. I've finally been able 
to sell it. I must confess that it is not a large lemon grove. 
It consists of one acre of lemons, 108 trees. 

But I take the job seriously. We shipped through Sun 
World, and put it on the market in same manner as if you had a 



31 

thousand acres. We're very proud of the kind of lemons that we 
produce for the economy. 

But in any event, I want to say that I know Mr. Badger, 
how he operated and insists on bringing in wasps and other 
predators of these pests, rather than the use of pesticides. 
So, I know that aspect of his work. 

Secondly, I have a great deal of respect for his 
background experience. You've heard a little bit of it here. 

But the one thing I want to say with regards to both 
these candidates is, first of all, you, I think, appreciate more 
than anybody else the limitation on funds. And some of the work 
hasn't been done as fast as we'd like it, but I will tell you 
this much, that the whole Board is dedicated to clearing up this 
backlog and getting things up-to-date. It hasn't been easy with 
the limited amount of money that's available and the demands 
that are on this particular board. 

I've watched that Board work. And one thing that I 
think is important is, number one, they are trying to enforce 
that very famous or infamous, which ever way you're looking at 
it, Porter-Cologne Water Quality Act. 

CHAIRMAN LOCKYER: I don't know who wrote that thing. 

MR. COLOGNE: I don't know, either, but it has been up 
dated recently through the good work of the Legislature, and so 
it isn't as bad as it was when it was written. You have to know 
that. 

But secondly, and most importantly, is, they have taken 
an attitude that the job is to be corrected, the errors. And 
when I was down there, I saw the City of San Diego, their 



32 

pollution in the Bay and various other places as a result of an 
aging sewage line. I've seen the work that's gone on in court 
with that problem. 

And that problem isn't the problem existing today from 
the present mayor. It isn't the job that was created by the 
previous mayor, nor the present governor when he was mayor. 
These are jobs -- are problems that have been created over the 
years and as a result of neglect. There's no question about 
it. 

Now, the question is, should the taxpayers pay a 
horrendous fine right now, or should that money from the present 
taxpayers, who would have to pay any kind of an assessment, go 
into fixing the problem, building up a good sewage treatment 
system. . 

Now, that battle has been going on in court, but right 
now, the issue is, should we fine them and put money into 
Sacramento to be spread around among all the people, or should 
we make them comply by bringing up to date their system, and 
making them spend the same amount of money. 

Now, they did assess a fine here, but in addition to 
that, they made them put money into upgrading the system, which 
serves the community right now. It's bringing to a head faster 
the cure for this pollution problem. 

I have the greatest respect for this Board. I know 
there are differences of opinion that people have when they 
can't get their way as to how this Board should act. But the 
Board has to act in a reasonable fashion with the funds that are 
available, doing the job to cure that. 



33 

Now, some of the problems with EPA go way back, and I 
know that they have been battled in court. And I haven't 
followed it in the last two years, but before that, I saw this 
go around and around, and I saw the work that the Board members 
put in on helping work out a solution to this problem, the time 
they spent in working with the City, along with the staff, to 
get a reasonable solution and stop those incidents of pollution 
that was going on. 

So, I think that this Board is doing the kind of job 
that you'd want them to do. They don't always make the same 
decision that you'd make, but you know from your work here, you 
can't always agree with everybody on everything. 

But I think the Board members have done a good job down 
in San Diego with all the problems that they've had in the Bay, 
and I think these two people are particularly well qualified to 
serve on that Board as the representative of the agricultural 
industry, and the other one is here representing water quality. 

Those are the kind of experts we want on those regional 
boards. Understand, they're not getting paid for that job, a 
hundred dollars a meeting, but they're giving their expertise, 
and I think that we're getting good bargain. These two people 
are really worth a lot more than we could ever hope to pay them 
for the service they are providing. 

Thank you. 

CHAIRMAN LOCKYER: Thank you. 

Yes, sir. 

MS. WARMERDAM: Mr. Chairman, Members, my name is 
Mary-Ann Warmerdam. I represent the California Farm Bureau. 



34 

Today I'm here on behalf of the San Diego County Farm bureau as 
well . 

I think Judge Cologne has more than adequately stated 
the case for both gentlemen. I would just like to reiterate our 
support for their reappointment and urge you gentlemen to vote 
likewise. 

CHAIRMAN LOCKYER: Thank you. 

MR. HALL: I'm Steve Hall. I'm with the Association of 
California Water Agencies. I'm here in support of Gary Arant. 

My contact with Mr. Arant is as a professional in water 
management. He is the manager of one of our member agencies, 
and has for over 20 years, been in charge of water management 
systems in various parts of the state. 

I've come to know Mr. Arant as a person who's well 
versed in the technical aspects of water management and waste 
water management, but he's also a creative and innovative 
individual who is genuinely interested in solving problems. 

I think if you look at Mr. Arant 's responses to some of 
the criticisms, both his written responses and as you heard his 
verbal responses today, he is a thoughtful person. He has well 
measured, moderate responses. He is essentially the kind of 
person who takes principal stances and seeks to solve problems, 
reflecting the needs of the entire community. 

I think former Senator, and Judge, and reluctant lemon 
grower, Gordon Cologne, said it as well as anybody: we need 
people in these kinds of positions that are of that ilk. And I 
don't know of any area of the state where it is more needed than 
in the San Diego County region. The waste treatment plant 



35 

problem in San Diego, for instance, went all the way to the U.S. 
Congress for solution. These are not easy problems to grapple 
with. 

We need people who are technically competent and who 
seek to solve problems in the approach, rather than taking a 
harsh or narrow point of view. 

We urge respectfully the Committee to recommend 
Mr. Arant for reconfirmation. 

CHAIRMAN LOCKYER: Thank you, sir. 

I think there may be some opposition comment, whom ever 
would wish to come forward with that. 

MR. IREY: Good afternoon. My name is Michael Irey, 
and I'm a licensed mullet fisherman fishing south San Diego 
Bay. 

In recent years — 

CHAIRMAN LOCKYER: What kind of fish? 

MR. IREY: Mullet. In fact, I have a picture that 
perhaps I could circulate for you people that will give you an 
example of diseased fish I've been finding in my catch 
recently. 

I presented several of these fish in March to the 
Regional Water Control Board, and urged them to do something 
about the discharge of chlorine in the Bay by San Diego Gas and 
Electric. 

The first question that the Board asked me is what I 
was doing back there, which really disgusted me. I mean, I'm 
licensed to be back there. I serve ethic the community. I'm 
their only conduit to fresh fish in San Diego. 



36 

There's very few of us commercial fishermen left. I 
don't feel that the Board is adequately protecting Bay waters. 

This permit has been overdue for six years. They 
haven't done anything. They just last week put it off for 
another month. They've had plenty of time to do this. 

Recently they were asked — 

CHAIRMAN LOCKYER: You think this specific problem 
might be related to the Edison chlorine discharges? 

MR. IREY: It's San Diego Gas and Electric. 

CHAIRMT^ LOCKYER: I'm sorry, yes. 

MR. IREY: I don't know. No one's done any scientific 
research. 

I'm merely presenting these fish as evidence that the 
Bay's in trouble. We can't afford to keep dumping pollutants in 
the Bay. San Diego Gas and Electric is the last major polluter 
of the Bay, and they're doing this on essentially an expired 
permit. This is a permit that was issued in the 1980s. We're 
now in the 1990s. This Board hasn't done its job. 

I don't think anyone on the Board deserves 
reappointment. I think rejecting these two individuals would be 
a good start. 

In fact, I'd like to read to you from my gill net log 
from 1991, 1/29, and this hasn't done much to help my business. 
In the comment section I put, "One jack had a cataract in one 
eye. This eye was also perferrated. The other jack had burned 
skin. I suspect it was chemical burn." 

The fish were taken directly in San Diego Gas and 
Electric exhaust water. 



37 

"I'm constantly harassed by San Diego Gas and Electric 
security while fishing back here. I suspect heavy discharge of 
chlorine, fluoride, and who knows what else. There are too many 
diseased fish in this area, and almost 100 percent of the 
abnormalities are from this small area. What are they trying to 
hide . " 

"Also, whenever I fish close to the exhaust, my stomach 
or whatever else gets wet is very red, sometimes mild rash at 
end of my trip. This condition disappears after several hours, 
and I haven't noticed this condition from anywhere else in the 
Bay." 

I'm concerned, as is anyone else who might be 
purchasing my fish, that — 

CHAIRMAN LOCKYER: How many years have you been 
fishing? 

MR. IREY: I've been fishing commercially 22 years, and 
I've been permitted to fish in south San Diego Bay since 1985. 

CHAIRMAN LOCKYER: Did you notify anyone with 
responsibilities for enforcement? 

MR. IREY: Sure. This is submitted to the California 
Department of Fish and Game on a monthly basis. This particular 
gear type was terminated under authority of Proposition 132, and 
so now I have switched gear to a lampara gear, and it's no 
longer required to keep a daily log of this. I'm the last guy 
who's fishing these. 

Recently, the Board was asked to delay the transport of 
dredging spoils from the Navy that were potentially contaminated 
with dioxin. They were asked to delay this for a month to do 



38 

further studies. The Board rejected that and went ahead and 
approved this project. 

It seems to me that they're very selective in the 
things that they want to go forward on. Why has it taken six 
years on this, and especially when you see the condition of some 
of these fish back there? 

CHAIRMAN LOCKYER: Thank you, sir. 

MR. OLSEN: Good afternoon. Members of the Senate, 
Chairman Lockyer. My name is Lee Olsen. I'm a resident of San 
Diego. I'm also the past president and current Chair of the 
Education and Conservation Committees for the San Diego Council 
of Divers. 

Bottom line, I'm a sport diver. I'm not an 
environmentalist. I'm a user of the ocean. 

One of the provisions both in the Porter-Cologne Act 
and the San Diego Basin Plan, and the California Ocean Plan 
which sets forth water quality standards for the ocean, is to 
preserve the beneficial uses of the ocean. And diving, 
recreational uses, is certainly one of the major ones in San 
Diego. In fact, our economy in San Diego is based on 
recreational use of our beautiful beaches. 

The problem is that we've been subjected to ongoing 
pollution from the operation of the City-run metropolitan waste 
water system. 

My personal experience with it began in '83, when 
diving off Point Loma, I surfaced through some unusually colored 
water which had white flocculant material in it. I asked a 
scientist friend of mine what that was, and he told me it's the 



39 

plume from the outflow. I said, what do you mean? 

I remember back in the '60s when they put that in, that 
stuff was going to stay down at 200 feet, and wouldn't bother 
divers or fishing or anything. 

He sent me to the Regional Water Quality Control Board, 
where I examined something called Receiving Water Reports, and I 
learned a new term, TNTC. When the bacteria counts got too high 
that the tests they were performing couldn't tell how high it 
was, they just put down TNTC, for "too numerous to be counted." 

And since that time, I've been involved in looking at 
water quality issues that affect our sport. 

This Board consistently — 

CHAIRMAN LOCKYER: How often would you see that entry? 

MR. OLSEN: Today? Today it's actually been improved, 
because the Point Loma outfall has been extended. It discharges 
into deeper water, and based on a number of factors, the Point 
Loma plant is now operating slightly above standard, versus 
below standard, which was the case in 1983. 

How did we get there? When EPA brought suit against 
the City of San Diego for violating the Clean Water Act, Judge 
Brewster reviewed the record of enforcement by the Regional 
Board. It was a whole litany discharge permits, cease and 
desist orders, agreements by the City of San Diego to upgrade 
the system, you know, compliance dates that were continually 
missed. He characterized the City of San Diego as being a 
scofflaw. 

But the other question is, why didn't the regulatory 
process work? Where were the orders? Why weren't the orders 



40 

enforced? 

Even today/ just two weekends ago, we were doing a 
safety program that we do for free with the San Diego City Life 
Guards, and where we take drivers on skin diving tours of local 
beach areas. We curtailed our safety program because there had 
been another spill at Wind and Sea Beach, part of the La Jolla 
beaches, adjacent to a pump station where they were having 
repeated spills over the years. 

Now, this isn't a new problem. If we take a look at 
the sewage spills, for example, all of Los Angeles County, all 
of Orange County, all of Riverside County, and we add together 
the number of spills reaching ocean waters, and the volume of 
sewage reaching ocean waters, guess what? It is substantially 
below the annual discharges in the San Diego region. 

One of the former EPA Administrators from the Midwest 
made a comment at an administrative and civil liability hearing 
in which the settlement agreement that Mr. Arant referred to was 
discussed. He couldn't understand why the Regional Board wasn't 
taking enforcement action, because he saw the difference in his 
own region between when you took fair but firm enforcement 
action against a major discharger and when you did not. 

He typified what we see in San Diego County today as a 
case where, over the years, the City has essentially found it 
easier to delay, to avoid compliance, to fail to meet their 
agreements, essentially be a scofflaw, and get away with it 
because of lack of enforcement at the regional level. 

I see the — unfortunately, I see regulatory process is 
broken and needs to be fixed in San Diego. Perhaps — I know 



41 

Mr. Badger and Mr. Arant are well-intentioned. They're good 
men. But perhaps they've been in their current positions too 
long, and it's time for change and getting some new perspectives 
in San Diego at the Regional Board level. 

When we go to the polls, we elect the governor, we 
elect members of the Senate, members of the Assembly. And we 
look to the Governor's Office and this body to appoint people to 
regulatory boards to administer the regulations fair, not to the 
advantage of a diver, or someone that has a particular 
environmental bend or twist, a fisherman or a discharger. 

But the laws, basically, to begin with, are 
compromises, and so are the regulations. You can't foresee 
every circumstance. 

But when we see in San Diego sewage spill, after sewage 
spill, after sewage spill, without enforcement, and in the case 
of, you know, the capital improvements that were mentioned by 
Mr. Arant, those weren't improvements that were ordered by the 
Regional Board. Those were improvements that, finally, EPA 
forced out of the City, because they had to take the City of San 
Diego to federal court to get them to comply not only with the 
Clean Water Act, but with the receiving water requirements of 
the State of California and conditions of the permit issued by 
this Board. 

So, I could go on, but I ask you to consider not 
reappointing these two members to the Board, and to — perhaps, 
we might see a fresh wind in the Board and a new direction, 
where we'll see more fair and firm enforcement, and fewer sewage 
spills and water pollution problems in San Diego. Particularly 



42 

I'm biased for the recreational diver who sees them everyday 
they go into the water. 

Thank you. 

CHAIRMAN LOCKYER: Next. 

MS. HUNTER: Good afternoon, Senators. My name is 
Laura Hunter. I'm here today to represent the Environmental 
Health Coalition's opposition to the reappointment of 
Mr. Charles Badger and Mr. Gary Arant to our San Diego Regional 
Board. 

As Gary said earlier, and I agree with him, we have a 
very serious difference of opinion and a difference in 
expectation. We have not opposed them, these two members, 
before. But we're here today because we don't know what else to 
do. 

We are very frustrated. The situation, not only does 
it stay the same, it continues to get worse. And while these 
are Governor appointments, it is up to the Senate, as you know, 
to reconfirm them. And we're asking for your help to get a 
change in San Diego. What we have now is absolutely not 
working. 

As you know, we have monitored the Regional Board for 
the last nine years. It is our conclusion that after many years 
of trying to work with the system — we believe in dealing with 
the hand that you are dealt — but we can no longer deal with 
these cards. We need some new ones. 

We have come to the conclusion that adequate water 
quality protection is not possible as long as this old guard on 
the San Diego Regional Water Board remains. 



43 

We oppose these reappointments because the record of 
the Board demonstrates a chronic unwillingness to enforce the 
law that you have charged the Board to uphold. 

We do not undertake this lightly, and we understand the 
seriousness of our actions. We are here because we are 
frustrated. We are afraid for our region, and we don't know 
what else to do. 

I don't want to just give you generalities. I have 
given you exhibits of eight or nine specific votes in which the 
public interest and the public health was compromised as a 
result of the votes of these Board members. 

Exhibit number one relates to the Paco Terminals 
cleanup. San Diego Bay has very serious, multiple contaminated 
sediment problems. After intense pressure, the Board did — and 
I even think a Senate hearing — the Board issued a series of 
cleanup and abatement orders. One of the worse sites we had was 
Paco Terminals. 

On December 9th, 1991, both Mr. Badger and Mr. Arant 
voted to weaken the level of cleanup at Paco Terminals by four 
fold. We appealed that order, and we prevailed on that order. 
The State Board found they had no technical basis by which to 
weaken that cleanup level . 

I was concerned, because their representative, who 
represented the Board at the Senate hearing, I believe, was Mr. 
Badger, and the feeling was, basically, they just had worn us 
out. We wanted to get it over with. That is not the basis or 
an acceptable reason to weaken a clean up order. 

Exhibit number two relates, as we've already discussed 



44 

a little bit, about the Strike Force. EHC is not the only 
agency that has recognized lack of will to enforce on the part 
of the Board. The FBI removed them from the task force. 
They've been the only agency, to our knowledge, that has ever 
been removed; regulator that has ever been removed from the 
task force, any agency, in fact. 

Cal EPA wrote them a letter, and even visited the 
Regional Board, saying, we really want you back on that task 
force. It works well. It's a good deterrent. We want you to 
participate. 

To date, they have not been reinstated. This exhibit 
also includes a copy of the Auditor General's report from 1987. 
I know that's long time ago, but it's still true today. Their 
cooperative strategy of asking people, "Pretty please, comply 
with your permit," does not work. 

Nothing has changed. We did a review of compliance. 
We found that we were getting about one percent enforcement of 
violations. To us, it is our view that was not adequate. 
Because they have not changed their strategy that isn't working 
then, it's still not working now, they haven't changed their 
attitude, this is why we're asking you to change them. 

CHAIRMAN LOCKYER: What does the one percent represent? 

MS. HUNTER: Well, we went through 19 of the NPDS 
permit holders around the Bay. We found 222 violations, two 
fines had been imposed. This was the five years ending in 1991. 

CHAIRMAN LOCKYER: That's the fine policy. 

MS. HUNTER: Well, that's the fine reality. I don't 
know what the policy is at this point. 



45 

Exhibit number three. The permissiveness that the 
Board has showed with the City of San Diego is as appalling as 
it has been destructive to our region. Here are, I think, some 
very revealing facts about the behavior of the City of San 
Diego. 

They violated their permit for 28 out of 60 months. 
40,000 dry weight tons of sludge went over in their permit limit 
into the ocean. Please don't confuse this with the dealings 
about the secondary sewage. This is just, you got a permit; 
you're dumping 40,000 tons over the limit; that's bad. They 
should have done something about that. 

Pretreatment program at that point had 35 percent 
compliance when it state took it over. You remember the very 
famous Point Loma sewage break, when the affluent met the 
effluent over the America's Cup. Beaches were closed for four 
months . 

EPA found that the City had misused the funds regarding 
their repair. We've had 3700 sewage spills in a seven-year 
period, 86 million gallons untreated sewage going directly into 
our surface waters. In one six-month period, we had 197 sewage 
spills. 

What has the Board done to address this? 

And I agree, belligerent, recalcitrant, very badly 
acting the City of San Diego relative to the sewage treatment. 
One thing they did was this. Mr. Badger voted, on September 
21st, 1992, to allow the City to keep the report about what 
caused the break secret. It took a state legislative action by 
Assemblyman, at that time, Steve Peace to get that report 



46 

released. That is very improper. That's a disclosure thing 
that we, as users of the ocean waters, deserve to know what 
caused that break. They wouldn't have let us have it. 

The Board also allowed the City to avoid installing 
required sludge beds for six years and didn't fine them. 

Now, I do take issue with this idea about/ well, as 
long as they just do it, wouldn't we rather have the money go 
for upgrading the sewage treatment. Of course we would. The 
problem is that they told the City to do it six years earlier. 
The City refused. The City played games. The City didn't do 
it. Then, when finally we catch them, there's 40,000 tons of 
sludge in the ocean later, the City goes, "Oh, gosh, we'll do 
it. We promise we'll do it. It's too little too late. They 
have not learned their lesson. 

Although the Board has issued some token ACLs, very 
often the moneys are held, and they suspend the fines. You 
don't have to pay it, so what's the difference. 

In fact, on April 25th, 1988, Mr. Arant and Mr. Badger 
voted to support the City's appeal of their very own ACL. That 
meant they sent a resolution to the State Board, saying, "Please 
overturn our ACL. We support the City's position on this now." 
So, they do not stand behind those very few enforcement actions 
that they take. 

Finally, soon after hearing that, some of you remember, 
we were here. Mr. Roberti was very clear. He wanted to see 
some improvement in San Diego. Mr. Badger and Mr. Arant voted 
an ACL of $830,000 against the City, and even referred it to the 
District Attorney for possible criminal prosecution. It was a 



47 

great step, and we applauded it. 

Unfortunately, they reversed themselves on 
December 14th, 1995. They backed down and took what we view as 
a very token settlement for all of the spills and violations 
made from the City during this period. 

Particularly offensive was an in-kind offer accepted by 
them to settle the sludge dumping. The Board agreed to withdraw 
the fine for an undefined in-kind pretreatment project that we 
still don't know what we're getting. The City said it's worth 
$250,000. I don't know what the independent mechanism is to 
verify exactly what it is. 

This kind of settlement is a travesty. They're not 
learning their lesson from this. If deliberate and chronic 
violations such as these do not deserve a fine, we must ask what 
does. 

I want to point out that the same day the settlement 
was agreed to, the same day the council person got up and said, 
"Oh, gosh, we've been bad. We'll never do it again." They were 
taking Scouts honors, and crossing themselves, and doing every 
hoop they could jump through to try to convince this Board 
they'd never, never spill again. There was another spill that 
same afternoon or early the next morning at Penasquitos Lagoon, 
and it just continued on the very same way. 

I have to say, I'm particularly disappointed in 
Mr. Badger's support of the settlement. As you heard, I believe 
he knows they've been bad. I believe he's frustrated with 
them. He had spoken very strongly in prior meetings that he'd 
had it with the City. They're belligerent; they're not doing 



48 

what they were supposed to do. And then, he went and he 
supported the settlement. When Board members are voting against 
-- what it sounded like to me -- was Mr. Badger's conscience, 
and maybe he can speak to that again, I don't know how we're 
ever going to get ahead in that case. 

Exhibit four, no big surprise that San Diego leads 
California in contaminated beaches. Now, before you start going 
and blaming Mexico all of a sudden, if you look at the list that 
I've given you on number four, a very small percentage of our 
beach closures come from Mexican sewage. Only one of our three 
permanent closures is from the border. The others are in 
Oceanside. That's not Mexico doing that to us. That's us, or 
rather, our Regional Board doing it to ourselves. We have a 
responsibility to deal with that. 

If we don't do anything about this, these beach 
closures will continue in San Diego to rise. We don't want to 
have that award for the State of California. 

CHAIRMAN LOCKYER: How much time of the year, how many 
days of the year, would you estimate there are beach closures in 
recent months? 

MS. HUNTER: I don't know in recent months. That's 
from the report that just came out. I know that there's 
something like 7 to 90 days, depending where you are in the 
year. I think Mission Bay had closures of around 90 days, south 
had around 70 days, so it's a big chunk of the time. And there 
are three permanent closures, meaning you never get to go swim 
there. 

CHAIRMAN LOCKYER: Where are they? 



49 

MS. HUNTER: Two in Oceanside and one near the border. 

CHAIRMAN LOCKYER: What's the cause of the Oceanside? 

MS. HUNTER: I think it's bacterial and other problems 
coming out of the — I think it's the Santa Margarita no, Loma 
Alta Lagoon and San Luis Rey. So, it's just this chronically 
poor water quality. 

CHAIRMAN LOCKYER: A discharge that would be the cause, 
a specific one? 

MS. HUNTER: I don't know that. I can find that out if 
you want to know. 

CHAIRMAN LOCKYER: I'll get an answer right now. 

Do you know? 

MR. ARANT: We believe the source of discharge, 
numerous source points. In some cases during spring water 
runoff, also septic tank discharge. That tributary covers an 
area that is serviced by a site specific sewage disposal unit. 

CHAIRMAN LOCKYER: Thank you. 

MS. HUNTER: Exhibit number five, the nonprotective 
votes they've made go back many years. On July 3rd, 1987, 
Mr. Badger voted to allow the Van Tol Dairy to continue to 
pollute a drinking water aquifer, in spite of neighboring 
residents' protests and valid concerns about their drinking 
wells. 

Mrs. Close was here at the last hearing. Some of you 
may remember her. 

Van Tol had filed none of their monitoring reports, and 
the Board allowed them to expand their already out of compliance 
operation. This is not the kind of representation we deserve. 



50 

even from the irrigated agriculture representative. 

Exhibit number six. On February 10th, 1992, Mr. Badger 
and Arant voted, in spite of compelling evidence to the 
contrary -- and I understand that Edison's consultants got up 
and said, "Oh, no. It's really okay," but there was very 
significant study and effort that went into documenting 
significant degredation of ventic species and a number of other 
issues at San Onofre power plant. The Board found they were not 
in violation of their permit. 

We all agree that energy generation is important. 
However, power plants, cities, these kinds of agencies were not 
exempted from discharge requirements and discharge permits in 
the Porter-Cologne Act, and the Board should not exempt them 
from this, either. 

Exhibit seven, the dischargers in our region have 
learned that foot dragging and what I call the "I don't wanna" 
defense works very well on the Board, and they exploit their 
leniency constantly. On October 2nd, 1992, Mr. Arant and Badger 
voted to uphold the permit to the Eastern Municipal Water 
District. It was so improper that EPA was forced to come and 
take the permit over and make a protective of water quality. 

At issue here the phosphorous and toxicity limit. An 
EIR was conducted with a level of one part per million 
phosphorous. On the Friday before the hearing. Eastern informs 
the staff, "Well, you know, we actually wanted to be 2.5 to 3 
over the weekend." They could only meet four parts per million 
limit for an unknown reason. 

Even though the EIR had been conducted on one, the 



51 

Board gave them a permit with four. The EPA came in and had to 
take it over. 

Another example on October 12th, 1995, they voted to 
suspend a successful monitoring program, thus undermining a 
five-year sediment monitoring effort. Although they did request 
action in 90 days, and we supported that, it's now been ten 
months. Guess what? There's no sediment monitoring program, 
and there's no alternative program. And guess why? The 
dischargers are dragging their feet, seeing just how much they 
can get away with, and the Board members are letting them. 

When we first all entered into this agreement, it was 
let's tweak the sediment monitoring program so it works better 
for everybody. Now the dischargers in the meetings are going, 
"Oh, no. We don't want to do any sediment monitoring, and we're 
going substitute it for all this kind of feel-good kind of 
stuff." That's not acceptable. We've had to appeal that 
decision. 

What was troubling about the action to suspend the 
sediment monitoring program is that the staff had said it is 
very valuable. It will help us find those expensive cleanups 
before they occur and fix them. 

They took their action on no apparent credible 
evidence, and the action punished those permitees that had 
completed the round of sampling required by law. 

When permit requirements can so easily and erratically 
be reversed, a disincentive is created for dischargers to invest 
resources to comply with the law. It sends the message that if 
you spend the money to comply with our water laws in San Diego, 



52 

you're stupid, because it costs money, absolutely agreed. But 
when it can just turn around just like that, it is a bad 
business investment to comply with the law. 

When we left that meeting, I asked one of the boat 
yards, I said, "Well, aren't you sorry that you did that round 
of sediment monitoring?" He said, "Yeah, I am." I said, "Don't 
you feel like a fool?" He said, "Yeah, I did." He complied 
with the law, and he was punished as a result of that. 

Unfortunately, the recent voting record is not much 
better. Exhibit eight discusses the Navy dredging spoils that 
are going to go from the Bay onto the beaches. Mr. Craven had a 
bill to get some moneys from the state to pay for putting the 
sediments on that. We worked with his office and had additional 
radiation and dioxin testing done, which had not been done, on 
the stuff that was going on our beach. 

I'm assuming he did that, because he wanted to be sure 
that it was safe and it was a good idea. On March 14th, 1996, 
Mr. Badger and Arant voted to refuse our request for a 
continuance of one month to give an independent consultant a 
chance to finish his review. The public has a right to expect 
that when they go to the beach, it will be poison free. 

Instead, they relied on the Navy's consultant to 
independently certify the sediments as safe. And of course, the 
Navy said it was safe. They have a conflict of interest. They 
have a dredge spoils disposal problem. 

Dr. Fred Youngs — we finally did have to pay our own 
money. We got another consultant that wasn't Navy related to 
look at it. He's a Ph.D. in chemistry from Columbia. You have 



53 

the findings in back; it's the last one I've had. And he states 
in his report, "It's my conclusion placement of dioxin 
contaminated sediments," and we knew there is dioxin in it. 
That's not up for debate — "on San Diego area beaches would 
pose an unnecessary and avoidable health risk." 

The Regional Board's staff said to us they didn't view 
it was their responsibility to make a determination whether it 
was okay for dioxin contaminated sediments to go on; just to 
certify that the tests were done. Well, that was not the intent 
of the legislation. 

Votes are not the only way that our water quality gets 
underminded, and I'll move quickly because I know we want to 
move ahead. But I do want to touch on this issue about the 
expired permits. 

The major shipyard permits, all of them, their permits 
have been expired for five years. That is a complete cycle. 
The law says you renew that permit every five years to update, 
to improve, to get better water quality. We missed a complete 
cycle on those. And SDG&E, as you know, it's been expired for 
six years. 

I do want to point out that SDG&E likes their permit a 
lot the way it is. It's an ancient relic. It's a dinosaur 
permit from the mid '80s. Industrial processed waters are going 
directly into the Bay, chlorine is being discharged directly 
into our south, a very sensitive and productive fishing area. 
They like it. I think it's in their interest to delay and drag 
their feet. Once again, exploit the good natures, in a way, of 
the Board members. But you've got to — we can't have that. 



54 

Although Naval facilities submitted their applications 
for permits in 1991, no permits have been issued/ none are in 
draft that are out for review that are going to happen by 
December. Forget it. They're not even — they're not even 
under serious discussion at this point. 

We could go on. The bottom line is this. This kind of 
enforcement record should not be rewarded with reappointment. 
This is a long-standing problem that will not go away until you 
send a message that this is not acceptable. We need new 
appointments. 

I think we've been over the rest of them. We're just 
asking you to deny their confirmation. Send a message that you 
want clean water. You want it in San Diego, too. 

And I thank you very much for hearing us today. 

CHAIRMAN LOCKYER: Thank you very much. 

Any questions of any of the three witnesses. 

You get the award for being a 33 record played at 78. 
I know you had to get a lot of material in there, so you had to 
kind of go fast. Thank you. 

Gentlemen, I guess it's time to have any response that 
either or both may wish to make. It's not exactly a trial, so 
you don't need to — 

MR. ARANT: Keep reminding me that. 

CHAIRMAN LOCKYER: — keep every specific fact, but 
just sort of the general pattern. 

MR. ARANT: I'll go. 

The first speaker concerning the diseased fish, we've 
seen the fish. We're concerned about that. 



55 

For us to conclude that that's a direct result of 
anything SDG&E is doing is a bit of a leap. 

It's true, there is no money to study that, and there 
is no data to verify or disprove that. As a matter of fact, 
part of the SDG&E renewal permit involves a number of studies of 
the Bay around the SDG&E plant to look into some of these 
problems that they may or may not be creating in the Bay. 

The issue of the sand, I addressed that in my 
presentation. Our responsibility was to certify the results of 
the testing by the Navy. We did that. 

CHAIRMAN LOCKYER: Could you have said they were 
inadequate, that the testing was inadequate. 

I guess some of the folks that have talked or others 
appeared before the Board and said, "We think you shouldn't 
agree to this right now. We've got independent expert evidence 
that shows dioxin." 

MR. ARANT: As I recall that discussion, the role and 
the responsibility of the Regional Board was to certify that the 
testing had been done as required by you law. That's my 
recollection. 

With respect the outfall, I want to emphasize that the 
outfall was lengthened and deepened, and so we believe that that 
situation has improved. 

I have not seen the information provided by Ms. Hunter. 
There are a number of issues there. 

CHAIRMAN LOCKYER: Some of them are the same. We 
didn't talk about the dairy, I guess. 

MR. BADGER: I can address that. 



56 

CHAIRMAN LOCKYER: We heard about it, I will say, the 
last time we had a confirmation, at great length, as I recall. 
We confirmed the appointee at that time. 

MR. BADGER: The reason the Board approved that permit 
at that time was, we felt there was adequate proof that water 
that drained from that dairy drained the opposite direction from 
the wells that were involved with that high nitrate problem. We 
felt that that dairy did not, in fact, have an impact upon those 
wells that were located northly of it. 

MR. ARANT: With respect — I just was jotting down 
some things as she went — the Paco Terminals. It's true that 
we did, if you will, buy into the argument that the cleanup 
could be done at a reduced level, so we did reduce the level. 

I would say, though, that we were presented information 
that showed that the reduced level would leave the sediment in 
the Paco Terminal area at a level that would not be acutely or 
chronically toxic to the population in that area. 

That was taken up on appeal by EHC, and the State Board 
did reverse our decision and did enforce more stringent cleanup 
levels, which was ultimately performed. 

But that's correct. We did reduce the cleanup levels. 

The live stream discharge permit with Eastern Municipal 
Water District, as I remember that, that got into more of a 
jurisdictional issue between EPA and the Regional Board. We 
felt that the phosphorous and nitrogen levels that our permit 
contained were reasonable. That permit was then later on 
handed back to the Regional Board, and it will be coming forward 
as part of the Rancho California live stream demonstration 



57 



project. 

The sediment monitoring issue, I did cover that here. 
We did lift the requirement for sediment monitoring on the basis 
that there was some hope that there might be a way to develop a 
coordinated monitoring program that would refocus some of the 
resources that were being spent on individual boat yards doing 
their monitoring, to more a broad-based monitoring program, to 
attack some of the transference issues. There's always the 
issue of, "Gee, what is that sediment? It's not my 
responsibility. It moves in by the currents in the Bay." 

As I alluded to before, what we are hoping to do is to 
create a monitoring program that takes in the entire Bay and 
uses the UCSD Super Computer to kind of model the Bay so we can 
take a broader look at all of the problems in the Bay. 

Finally, on the boat yards, at the time that we had 
suspended the sediment monitoring, these boat yards have been 
going through actual cleanups. So, there has been sediment 
monitoring, monitoring the effectiveness of the actual sediment 
cleanup, which was enforced by the Regional Board. 

CHAIRMAN LOCKYER: Are these boat yards where they're 
constructing or maintaining service? 

MR. ARANT: Maintaining. 

The contamination results from the cleaning of the 
hulls. And so, we have gone through a series of sediment 
cleanups. The last one is under way. 

It has taken a long time. These things take many, many 
years, because there are legal issues, there are jurisdictional 
issues. But we have affected a sediment cleanup. 



58 

And I would, with all due respect to Laura, not every 
Board member is going to absolve the boat yards of their 
sediment monitoring responsibility. I, for one, believe that 
when we come up with a comprehensive program, that sediment 
monitoring may be at a reduced level over time, but sediment 
monitoring is important, will be an important component of the 
final monitoring program that we have for the boat yards. 

Those are the notes that I had. I'd be glad to respond 
to any specific questions. 

MR. BADGER: I would like to especially comment on the 
sediment monitoring. 

It was suspended, yes. There's an ongoing program to 
determine what type of monitoring will be required now, and 
whether it is sediment or not remains to be seen. 

However, sediment monitoring has continued under law as 
they remove -- as they go into these boat yards and they take 
this sediment out, under law they must be monitored to see 
what's in there. So, sediment monitoring is ongoing even right 
now. It has been ongoing while they have been removing sediment 
from the Bay. 

Also, in the Santa Margarita watershed, they will be 
issued a permit probably within the next three to four months 
for the live stream discharge. This is something when EPA look 
it over, then we, working with them on it, they now agree with 
us that these limits that we want to have will be enforced at 
that point in time. 

Ms. Hunter talked about the City of San Diego, and how 
badly they've been doing with their sewage spills. Every 



59 

meeting we have of the Ninth Regional Board, I make a point of 
letting the public know who is doing the sewer spilling in 
Region Nine. The City always leads; the City always leads. 

However, I think maybe she may have gotten a little 
confused. She talked about three beaches were permanently 
closed: two in the north county, one is south of the City of 
San Diego. So, for once those had nothing to do with the City 
whatsoever. 

CHAIRMAN LOCKYER: They're still in your jurisdiction. 

MR. BADGER: Yes, they're still in our jurisdiction. 

CHAIRMAN LOCKYER: I think that was the point. 

MR. BADGER: The sludge problems, hopefully, that 
sludge problem, it's been trucked away now; it's gone; it is 
finished. That, I believe, is where the judge hit us with a 
Writ of Mandate, that we had to go back and redo before we could 
— before that fine — 

CHAIRMAN LOCKYER: This was the Navy's? 

MR. BADGER: No, that was the City again. 

CHAIRMAN LOCKYER: Yes, I know the one. 

MR. BADGER: Usually the City down there. 

Then Mr. Olsen talking about the Judge Brewster calling 
the City scoff laws back in 1983. Neither Gary nor I were on the 
Board in 1983. But it didn't take us long to get up to speed 
that that was a very true statement. 

That's all I have, Mr. Chairman. 

MR. ARANT: Under the discussion of EHC's survey of the 
various permits around the Bay, I would like to re-emphasize 
that many, many of our enforcement actions are informal 



60 

enforcement actions. In other words, they were handled at the 
staff level. And so, there have been a been number of informal 
enforcement actions that have led to corrective action. 

It is the more difficult and the more — the larger 
violations that ultimately reach the Board level for enforcement 
action. 

MR. BADGER: Also, one part of Ms. Hunter's testimony 
that there was a few hundred violations in one area. Over half 
of those were caused by one thing that the Navy had done, and 
under our enforcement levels A and B, staff had taken care of 
that. It was corrected. We never saw it at the Board. The 
Board members never saw that great number of violations. 

CHAIRMAN LOCKYER: It didn't come up? 

MR. BADGER: It was corrected by staff. 

CHAIRMAN LOCKYER: Yes, another comment. 

MR. OLSEN: Perhaps I misspoke about Judge Brewster's 
comments. The case is a federal case, CV 88 1101(a). It was 
filed in November of 1988. Judge Brewster's comments were made 
in court session in 1989. 

CHAIRMAN LOCKYER: Had you concluded? 

Any questions from Members at all? 

Okay, I guess we're at that point. What I've indicated 
to Senator Lewis, who has bounced back and forth between 
Appropriations Committee and this one, is that if it made a 
difference to have himself and Senator Beverly, who's at the 
Convention in San Diego, if it would make a difference to have 
them present, I'd think it would be appropriate to postpone 
voting and all. I don't think it does. 



61 

And it's the most difficult thing to do, frankly, to 
sit here and vote no on somebody who's been serving for a number 
of years in public capacities. 

One of my concerns is, it may just be too many years. 
And we have a very limited role with respect to the dozens of 
appointments that we review, or policies that we act on. Most 
of them emanate from the executive branch. 

When you hear comment from around the state about the 
jobs of water quality undertaken by the different Regional 
Boards, San Diego seems to be the one that is most frequently 
criticized for weak enforcement. 

I assume we could probably talk for days or months 
about each one of those issues that somebody has made a comment 
on. It just seems to me that our task is not to get consumed by 
the detail, but to understand the general trend and pattern. At 
least personally, I'm convinced that we somehow need to send a 
message that stronger enforcement is necessary in this region. 

I'm partly sorry that it happens to be to you two that 
are before us, because you're obviously public citizens 
committed to doing what you can to make life better in your 
region, and yet I feel compelled to somehow send that message to 
people and the region that we just demand clean waters and more 
adequate enforcement efforts. 

MR. ARANT: Can I speak before you vote. 

CHAIRMAN LOCKYER: Yes. 

MR. ARANT: If it goes the way I think it's going, I 
would just like to say that I've enjoyed my time serving the 
State of California. 



62 

I would also like to say that, knowing what I know now, 
I wouldn't have voted any differently on any of the issues that 
came before me. Because just as you, as Legislators sit here 
and hear testimony on each and every bill, and then later on, 
people go back and say, "What was the Legislature thinking about 
when they did this? Didn't they foresee those problems?" 

Each issue that we deal with is presented with various 
points of view, a lot of data, history, past violations, past 
efforts to correct violations. And it becomes a quasi- judicial 
process, where you sit in judgment based upon information you 
receive. 

So, I would like to say that, yes, there's been some 
decisions that may have, in retrospect, been done differently. 
But I think it's important when you're sending messages to 
future board members, that you send the message that you need to 
deal with each issue on the merits of that issue, and not be 
looking down the road at your next confirmation hearing, and how 
am I going to be criticized by public interest groups or special 
interest groups. That should not affect the vote of your board 
members. It never did affect vote, and I'm proud of that. 

And you need to be cognizant of sending a message that 
my replacement, if there is a replacement for me, needs to be 
worried about how he or she votes because it may not bode well 
the next time they seek reappointment or confirmation. 

CHAIRMAN LOCKYER: Well, I don't know what to do about 
that. That is a problem. 

I can tell you a number of votes I've cast over the 
years that, in retrospect, I wish I had cast a different vote. 



63 

So, I have a little different experience than you. 

But it seems to me that if, using your language, if I 
were to be critical, it's that this Board has been too sensitive 
to special interests, starting with San Diego Gas and Electric 
and others. That's just my conclusion from what I've heard. 

As a result of that, I don't mean any personal 
diminishment of your commitment to these tasks, or your personal 
integrity, or anything of that sort. I just think as a matter 
of policy, I would prefer to see a more vigorous enforcement 
activity. 

Thank you, gentlemen, though, for sharing your thoughts 
and helping educate us with respect to these issues. 

I think the vote we have to take would be either to 
move them out to confirm, which Senator Lewis would make, or to 
hold them in the Committee, which I don't think there's three 
votes to do. So, I think we just maybe don't do 
anything. 

SENATOR AYALA: We do have a short vote here. 

CHAIRMAN LOCKYER: Yes, we have two that would vote to 
confirm. I believe we have two that would vote not to confirm. 
And the last I heard, at least, one that would wish to abstain 
and not cast either a yes or a no vote, if that's accurate. 
Senator. 

SENATOR AYALA: Couldn't we hold it until the whole 
board is here for vote only? 

CHAIRMAN LOCKYER: Yes, we can. 

MR. ARANT: Are we required to come back? 

CHAIRMAN LOCKYER: No. 



64 

Okay, let's see, going back to our agenda, we do have 
Mr. Canestro and Mr. Storchheim, both appointees to the State 
Building Standards Commission. 

I guess you might as well both come up. There'll be 
the same questions for you both, I think. 

Hi, do you want to tell us a little about yourself, 
kind of some background or something? 

MR. STORCHHEIM: Yes, I'm Bob Storchheim. I hold the 
local building official's seat on the Building Standards 
Commission. 

CHAIRMAN LOCKYER: Irvine, isn't it? 

MR. STORCHHEIM: I am the chief building official, 
Irvine. Have been for — since 1976. I have extensive 
experience in the construction industry. 

And we understand that you have some questions about 
codes, and I stand ready to respond to them and any other 
questions . 

Thank you. 

CHAIRMAN LOCKYER: Thank you, sir. 

How many years have you served on the Commission 

MR. STORCHHEIM: This is — this would be my first 
reappointment. So, I've served one term prior to this one. 

CHAIRMAN LOCKYER: This is five years so far? 

MR. STORCHHEIM: Five, yes, four and a half. 

CHAIRMAN LOCKYER: All right. 

Yes, sir. 

MR. CANESTRO: My name is John Canestro. I live in 
Castro Valley, California and have my office in Pleasanton. I'm 



65 

a consulting engineer and have been for the past ten years. 

Prior to that time, I spent 25 years as building 
official in the City of Hayward and the City of El Cerrito. 

I've served for the past 12 years happily on the 
Building Standards Commission as — currently as a public 
member. 

And I understand, sir, you have a lot of questions. 

CHAIRMAN LOCKYER: Well, I think mostly we had 
questions about the plastic pipe controversy, and wanted to 
spend some time understanding your perspectives on that. 

I could ask questions, or you could just tell me what 
you think. 

MS. CANESTRO: Well, there are two issues. Senator. 
One is — the current one is the CPVC. And there has been an 
issue of — a legal issue more than one of the Commission's 
involvement, and that's on the ABS or the Acrylonitrile- 
Butadiene-Styrene piping. 

And there are two issues. One on the ABS pipe, and one 
is on the CPVC piping. 

As I stated, the ABS issue is more of a legal issue and 
does not directly involve the Building Standards Commission. 

CHAIRMAN LOCKYER: And CPVC is — 

MR. CANESTRO: Is one we have taken an action recently 
on a submittal by the Department of Housing and Community 
Development. 

CHAIRMAN LOCKYER: Right. And what did the Department 
indicate or recommend? 

MR. CANESTRO: Well, the Department sent to us — let 



66 

me back up. 

There's a bill passed last year. It was an emergency 
bill that grandfathered in some CPVC piping that was installed 
in Southern California because the soils became very hot; that 
is, very acidy. Ate through all metal piping, including copper, 
so that the departments down there allowed the use of CVPC 
piping in the soils. 

The emergency legislation prompted the Department of 
Housing and Community Development to develop some regulations 
for permitting CPVC to be used where, prior to that time, there 
was -- it was disallowed in the State of California for a period 
of about 15 years. 

CHAIRMAN LOCKYER: And so, the Commission then acted on 
that recommendation how long ago? 

MR. CANESTRO: Yes, three months ago. 

CHAIRMAN LOCKYER: Okay. 

MR. CANESTRO: We had taken an action to support the 
recommendation of the Department of Housing and Community 
Development. That action was affirmative. We did support it, 
and it became — went into effect immediately. 

CHAIRMAN LOCKYER: You didn't have a son that went to 
San Leandro High, did you? 

MR. CANESTRO: No. 

CHAIRMAN LOCKYER: Well, you're a constituent, so that 
was partly why I thought that the name sounded familiar. 

MR. CANESTRO: Went to El Cerrito High School. 

CHAIRMAN LOCKYER: So, the current status, then, of 
CPVC is that it's permissible in what circumstances? 



67 

MR. CANESTRO: It's permissible to be used throughout 
the dwellings and in water service. 

There has been some Writ of Mandamus filed with the 
court in San Francisco to reverse the action taken by HCD as 
well as the Building Standards Commission. And that is pending. 

CHAIRM7\N LOCKYER: Either of you on this point, still 
on the pipe. 

There seemed to be some substantial amount of comment 
that there are public health risks or impacts associated with 
CPVC. Did your Commission have to take testimony about that 
when you acted? I see heads nodding. Yes? 

MR. STORCHHEIM: Yes, there were several hearings. 

The first action was an urgency action. Second one was 
a full rule-making process, where a 45-day hearing process 
occurred, and the Building Standards Commission conducted 
hearings. And we took on quite a bit of testimony, testifying, 
attesting to the fact that there -- one side said there was a 
health problem; the other side said there wasn't. 

CHAIRMAN LOCKYER: And how did you resolve that dispute 
in your own mind? 

MR. STORCHHEIM: Well, first of all, we took testimony 
that every state but California has been using CPVC, and there 
was no documented evidence that it was a health risk. And there 
was documented evidence that when water plants don't have the 
right chlorine formula make-up in their water delivery, it is a 
problem. And other forms — all metallic forms of water 
services failed. 

So, putting that all together, this is the reason that 



68 

we made this issue. 

We also questioned how this worked with CEQA, and they 
had some opinions provided to us in that regard. 

MS. CANESTRO: The bill itself that prompted the action 
of HCD mentioned the CEQA or the EIR was not necessary in this 
process. The precise language I don't remember, but there was 
some language regarding that exclusion of an EIR. 

CHAIRMAN LOCKYER: On the existing Southern California 
problem? 

MR. CANESTRO: Yes, sir. 

CHAIRMAN LOCKYER: But you now have a wider approval. 
That is, it's now standard, as I understand the current status 
of things. 

MR. CANESTRO: Yes. 

CHAIRMAN LOCKYER: So, it's not just the Southern 
California grandfathering, so to speak, but the babies in the 
future, plastic pipe is permitted. 

MR. CANESTRO: Statewide, that's correct, sir. 

CHAIRMAN LOCKYER: Are there other questions before we 
take any testimony? 

SENATOR AYALA: I'd like to know your views on the 
plastic pipe in building construction. You touched on it 
earlier, but what are your views as it pertains to plastic pipe? 

MR. CANESTRO: This is on CPVC, sir, or ABS? 

SENATOR AYALA: Yes. 

MR. CANESTRO: CPVC is an alternate material, and as 
long as the material is not abused — that is, the material 
temperatures on the water heater doesn't exceed the 190 degree 



J 



69 

limitation; it's within 170 degrees, which is the working 
temperature. Most water heaters run 135 to 140 degrees for 
domestic use — there shouldn't be a problem, and I doubt there 
would be. 

CHAIRMAN LOCKYER: McDonald's doesn't put its coffee in 
plastic pipe, apparently. 

MR. CANESTRO: McDonald's wouldn't be allowed to use 
this piping, Senator. 

MR. STORCHHEIM: To expand on that, there is a relief 
valve required by code, where it would discharge at 140 degrees. 
And that is the safeguard. 

We also — there's a very strict set of standards in 
the approval in the plumbing code for the installation of this 
material, such as when it goes through fire separation test, and 
testing by a recognized list — list testing listing agency, to 
attest to the fact that it can be used in that regard. If not, 
a different material would have to be used. 

SENATOR AYALA: As I recall, I think, last year an 
Assembly bill last year provided authority to use plastic pipe 
whenever it was feasible. 

Is thank working today? Has that been used? 

MR. STORCHHEIM: I believe you're referring to 
Assemblyman Baca's bill. 

SENATOR AYALA: Yes. 

MR. STORCHHEIM: That's the one that triggered HCD to 
write this regulation and submit it to the Building Standards 
Commission. 

SENATOR AYALA: That can be used today in domestic 



70 

application? 

MR. STORCHHEIM: Yes, sir, as long as it complies with 
public standards and complies with all the requirements in the 
Uniform Plumbing Code. 

SENATOR AYALA: Prior to that bill, they couldn't do 
it? They couldn't use it. Prior to the Baca bill, they 
couldn't do it? 

MR. STORCHHEIM: No, sir. 

CHAIRMAN LOCKYER: I think the statute was adopted in 
'94, it might have been a year or two before that, which 
designates for purposes of the Uniform Mechanical Code — I 
always confuse these letters — but lAPMO, I think it's called, 
or something like that. 

Anyhow, I think that's what's in the actual law, but as 
I understand, the Commission took some different requirements 
and adopted those. 

Could you just kind of help us understand what's going 
on here between these different groups or something? 

MR. CANESTRO: In 1980, sir, there was a complaint 
filed, an exclusionary demand of plastic piping for domestic 
use. That went through to the — it was based upon a change in 
1982 Uniform Plumbing Code, which was different from the 1979, 
which allowed plastic piping on some limited basis of type of 
buildings and drain wastes and vent systems, but pretty much 
allowed PVC and CPVC, AB piping which is another plastic pipe, 
through the buildings. 

The court ruled that they needed a complete EIR 
provided to ensure that the carcinogenics that may or may not be 



I 



71 

in the piping was evaluated. And the EIR then had to come back 
to the HCD, and then there would be public hearings. 

It's my understanding that the EIR was done. It was 
finished and provided to HCD. And I don't know where it stands 
as we speak in terms of public hearings, but it has been 
completed. 

The draft that I've read of that EIR does not show that 
there are carcinogenic problems with the use of CPVC. 

There is some contest, as I understand it, that the EIR 
was not complete and did not do an adequate job. That's a 
matter of others' opinions, of course. 

CHAIRMAN LOCKYER: Maybe I was -- 

MR. STORCHHEIM: I understand. Senator. 

CHAIRMAN LOCKYER: There seems to be a statute. 

MR. STORCHHEIM: You're talking about the adoption of 
the Mechanical Code. 

CHAIRMAN LOCKYER: Yes. 

MR. STORCHHEIM: There is a statute that states that 
the Mechanical Code as published by the International Conference 
of Building Officials, which we will call ICBO, and lAPMO, 
jointly published, will be the model codes referenced in the 
State of California. 

And it worked very well over the years for the state 
until the organizations had a parting of the ways. There was a 
business change. They were not working together any longer. 

CHAIRMAN LOCKYER: What's caused the divorce? 

MR. STORCHHEIM: To the best of my knowledge, it was a 
business dispute between the two organizations. 



72 

CHAIRMAN LOCKYER: Over — 

MR. CANESTRO: How they were structured and how they 
were operating. 

MR. STORCHHEIM: How the Code changes would occur. 

So, here we had the dilemma. The statute also requires 
us to do a triennial adoption to look at the codes every three 
years. There's a three-year code cycle, both organizations. 

We were faced with the dilemma of these two 
organizations not getting along. We had to have a Mechanical 
Code. There were federal mandates that the state had to comply 
with. One of them, for example, which you may be familiar. 
Senators, were the refrigeration, whole environmental change in 
refrigeration. 

CHAIRMAN LOCKYER: Yes. 

MR. STORCHHEIM: We needed a code that dealt with 
that . 

So, I believe all the Commissioners were very concerned 
that this thing be worked out between the two organizations. 

In September of 1994, we started a series of meetings, 
spearheaded by the Secretary of Consumer Services. There was a 
committee established, and all the parties were brought 
together. And we have a chronology of some 58 contacts that 
were made, some 13 or more actual meeting by all the parties. 
We continued to try and get these organizations to 
come together because the most healthy thing that can occur for 
California is for them to come together and make a business 
agreement. 

And we are very aggrieved. We're very concerned. We 



73 

continue to work. 

There have been — there has been talk in the last few 
days of an accelerated activity to make this work. And the 
whole Commission has been kept abreast of what's happening. The 
Negotiating Committee could only have two Commissioners on it 
because of the Open Meeting Act. 

And we intend to, and make this commitment to, resolve 
this problem once and for all so we can move ahead. 

CHAIRM7\N LOCKYER: If there aren't other questions, 
let's take some testimony, then I'll call you back, gentlemen. 
Thank you very much. 

Supporters that want to make a comment. 

MR. RAYMER: Thank you, Mr. Chairman, Senators. 

I'm Bob Raymer. I'm Technical Director and staff 
engineer with the California Building Industry Association. 

I personally have known both of these individuals for 
well over a decade, and in Mr. Canestro's case, for 15 years. 
Without question, without question, they both have extraordinary 
resumes. I'm sure that you've reviewed that. In Canestro's 
case, he's probably one of the most distinguished building 
officials in the entire country. 

I represent our national organization on a number of 
building code issues at the national level — handicapped 
access, energy conservation, fire safety. And in many of my 
travels to other states, the East Coast, John is also held in 
the highest regard. 

I've worked with Mr. Storchheim for over a decade on 
Energy Code issues, highly technical code. But once again, he's 



74 

always had the best interests of the state at heart. An 
incredible amount of dedicated and good community service has 
been put into this over the years. 

I should say that while -- 

CHAIRMAN LOCKYER: What's your association's philosophy 
with respect to plastic pipe? 

MR. RAYMER: Our association philosophy is that, number 
one, we want the State of California to reference the national 
codes with as few amendments as possible. Number one, the 
uniformity issue plays well throughout the states. Somebody who 
designs a building who may have their office based in San Diego, 
but is going to build it in Yreka, it'd be good to know what the 
codes are. And quite frankly, you can be held at the plan check 
counter and everywhere else if there are slight modifications. 

Well, once again, if we take the national codes, with 
as few amendments as possible, that problem is pretty well 
resolved. 

In the case of plastic pipe, this is a very different 
issue than what the Commission has usually been dealing with 
over the last 15 years. Usually, in almost every instance, the 
Building Standards Commission is debating and reviewing proposed 
modifications or cimenditients to the National Model Building 
Codes. 

In this particular case, with CPVC, Chlorinated Poly 
Vinyl Chloride pipe, what the Building Standards Commission was 
considering this time around was allowing the use of the Code as 
written at the national level. For the last 14 to 15 years, the 
other 4 9 states have been utilizing that section of the National 



75 

Code which allows CPVC. 

But there's a long history in California over the 
plastic pipe issue in general. For about the first decade of 
that controversy, we were pretty much in the middle of the road. 
We obviously wanted to have access to a wide variety of 
products. In some cases, construction with CPVC and other 
plastic pipes can be done much cheaper than metal pipes, but in 
other cases, you may want to use the metal pipes for certain 
structural integrities, or whatnot. So, in essence, we wanted 
to have a full range of choices as allowed in the other states. 

At the same time, we did not want to be putting 
something into our homes which could later be a health problem. 
And so, part of my duties with CBIA was to monitor the 
particular pipes, reviewing the EIR that was going on. 

And over a course of time, it did become apparent that 
there was, as usual, more to the issue than met the eye, but it 
seemed that at least with the case of CPVC — I'm not speaking 
for Poly Butalene or ABS — but at least with CPVC, there was a 
very good track record, an established use throughout the rest 
of the country with little, if any, unnecessary problems. 

I mean, there's problems with any building product, 
metal pipes or plastic pipes. If it's installed incorrectly, 
you'll certainly have problems down the road. 

But as representing our group at a national level, CPVC 
has very good track record. And so, our policy is, if it's 
allowed in the national code, let's go with it unless it can be 
proved that it's bad. 

CHAIRMAN LOCKYER: Okay. 



76 

MR. RAYMER: A few other points related to governmental 
efficiency and the consolidation efforts. 

Both John and Bob have been key figures in the effort 
to consolidate the codes and the code writing process. Case in 
point/ in 1984, I was working out of several different manuals 
and code books to try and understand our own handicapped 
accessibility regulations in California. Today, I only have one 
code book and one implementation manual. 

The same goes for the energy regs . I used to be 
working out of six different code books in 1984 and '85. Today, 
once again, it's one code book and one design manual. 

For the architects out there in the field that are 
expected to keep up to date with the codes, to implement these, 
given all the other concerns that they have to deal with, the 
work that John and Bob have done over the last five to six years 
in getting some common sense and efficiency to the project have 
just been incredible. We, the private sector, are very grateful 
for that. 

More importantly and more recently, the implementation 
of the AB 47 code consolidation process, instead of having over 
a dozen separate code development and adoption proceedings going 
on at the state level at any given time, which I used to have to 
represent CBIO in the early '80s, we now have one annualized 
process. There was a lot of work that went into that bill. It 
was supported in the end in a bipartisan way. However — 

CHAIRMAN LOCKYER: Who was the author? 

MR. RAYMER: — getting the regs actually implemented 
took us about a year and a half to two years, and we had to burn 



77 

the midnight oil. 

CHAIRMAN LOCKYER: Who was the author? 

MR. RAYMER: That was Delaine Eastin, AB 47, 1992, I 
believe. 

And in the end, it is certainly working out quite 
well. And to make that happen, once again, the midnight oil had 
to be to be burned. 

The state has done well with these two representatives. 
Thank you very much. 

CHAIRMAN LOCKYER: Thank you. 

MR. SCHULTZE: I'm Don Schultze, and I'm the building 
official for Sacramento County and represent CABO, the 
California Building Officials. 

California Building Officials are in very strong 
support of both John and Bob. And I — personally, I was the 
past member of the Building Standards Commission, so I'm very 
aware of the responsibilities of that commission. 

I can say that from personal experience, that both John 
and Bob have just been doing an outstanding job for the building 
officials of California. 

CHAIRMAN LOCKYER: Thank you. 

I'm going to call up opposition, if there is some 
present, but I think it might be worth making note of a letter 
from the President of B.F. Goodrich, who apparently saw Governor 
Wilson while he was campaigning for President last fall in 
Columbus, Ohio. 

In the letter, it indicates that B.F. Goodrich is the 
principal manufacturer of CPVC, that it's been approved by 



78 

various code organizations in other states, and California is 
used for fire sprinkler systems and industrial piping. "Would 
like to see the California market opened up, but due to a long 
and drawn out battle with the pipe trades unions, and state 
regulatory policies developed in a previous Democratic 
administration, such pipe is not allowed in California." 

He goes on to say that the Department of Housing can 
issue an approval of CPVC plumbing by edict, and wished that 
that would happen, best wishes on your campaign, and so on. 

Well, it's interesting to me that this letter was sent 
in September of '95. Shortly thereafter, the Housing and 
Community Development Department did, in fact, issue the edict 
that B.F. Goodrich was requesting, and then it was approved by 
this Commission. 

It stinks. It stinks of rotten, dirty special interest 
politics. 

Okay, what do you fellows want to say? 

MR. CARTER: Mr. Chairman and Members, Art Carter, 
representing the California Pipe Trades Council. 

Dan Cardozo, who's here with me and is attorney with 
the state Pipe Trades Council, we are here in strong opposition 
to both of these nominees. The plastic pipe issue, and the 
manner in which it was dealt with is one of the key issues. 
There is another, and I'll let other witnesses speak to that. 

But Mr. Cardozo has been dealing with this issue at 
length for some time. I think he could very quickly lay out the 
chronology of the manner in which this has happened, and in 
particular, the manner in which the Commission has acted on 



79 

thiS/ despite being given lots of information. 

And in fact/ the letter to which you refer from B.F. 
Goodrich, we discovered through the Freedom of Information 
request in the file of the Building Standards Commission. 

SO/ at this point/ let me turn this over to 
Mr. Cardozo. 

MR. CARDOZO: Thank you. 

Good afternoon/ Mr. Chairman and Members. My name is 
Daniel Cardozo. I'm an attorney representing the California 
Pipe Trades Council. 

As Mr. Carter indicated/ we are opposing the 
reappointment of these nominees to the Building Standards 
Commission primarily because of the recent action taken by the 
Commission to approve Chlorinated Poly Vinyl Chloride/ CPVC 
plastic pipe, to carry drinking water in homes throughout 
California. The first time that that action's been taken in 
this state. 

We think — in our view, this action was taken in 
blatant disregard of the public health and safety. It was taken 
despite the fact that the public and worker health studies and 
environmental impact report/ that had been commenced to evaluate 
the impacts of this action on public health and safety, have 
never been completed. And it was taken despite the fact that 
this administration/ the Wilson administration, assured in 
writing all parties that had been involved in the plastic pipe 
EIR proceeding/ including several members of this Legislature/ 
that it would not take action to approve plastic plumbing pipe 
until the environmental impact report and the public health 



80 

Studies were completed. 

Very brief background on this. The recent Building 
Standards Commission action was to approve building standards 
proposed by HCD, by the Department/ to allow CPVC use throughout 
the state. 

HCD had previously determined that that very action, to 
approve CPVC, would potentially cause significant public health 
and worker health and environmental impact in the state. 

CHAIRMAN LOCKYER: When was that? 

MR. CARDOZO: That was in 1980 that the Department 
originally acted. In '82, they commenced the EIR process. 

HCD determined that there was a potential for 
significant impact. It prepared its initial — let me correct 
myself. 

In 1982, it determined that an environmental impact 
report was required, including a worker health study. 

CHAIRMAN LOCKYER: Does this letter from Maureen 
Higgins from '89, is that the one you're relying on to say they 
wouldn't adopt anything until there was a complete study? 

MR. CARDOZO: Yes, that's right. 

CHAIRMAN LOCKYER: Nothing subsequent to that? 

MR. CARDOZO: Nothing subsequent to '89. 

What happened, the chronology is that the Department 
prepared a draft EIR which included the worker health study. 
The initial determination of the Department was that the plastic 
pipe approval presented a potential for significant public 
health hazards. Those hazards in particular had to do with the 
approval of CPVC drinking water pipe. 



81 

The Department's conclusion in its initial study was 
that the use of CPVC could result in the leaching of toxic and 
carcinogenic chemicals into the drinking water carried by the 
pipe, and that workers could be exposed to toxic chemicals 
contained in CPVC solvents during the installation of the pipe. 

The Department prepared a worker health study. It 
prepared a draft environmental impact report. In 1989, it 
circulated that draft EIR for public review. 

It received an precedented outpouring of criticism. 
There was virtual unanimity that that draft EIR was woefully 
inadequate. There were comments in the record from labor 
organizations, from environmental and consumer groups, from 
state And local public agencies, including the administration's 
own Department of Health Services, which strongly criticized the 
analysis in the draft EIR. And it included comments from 
several members of this Legislature, both Democrat and 
Republican. 

The Department — by the way, the Department's own 
legal counsel concluded that the draft EIR was legally 
inadequate and would not support the Department ' s approval of 
the pipe without further analysis. 

CHAIRMAN LOCKYER: What year was that? 

MR. CARDOZO: That was 1989. 

The Department then went back to the plastics industry, 
asked for additional funding to complete the document. 

The plastics industry, in the face of this opposition, 
decided to cut its losses, terminate the project, and directed 
HCD not take any further action to evaluate plastic pipe. That 



82 

was in 1994. 

And the project has remained in suspension until fall 
of last year, when, as the Chairman alluded, there was a meeting 
between the President and CEO of B.F. Goodrich Specialty 
Chemicals, which is currently the only domestic producer of the 
CPVC resins which are used to manufacture the pipe. That 
meeting was followed up with a letter September 1st, where the 
President of B.F. Goodrich Specialty Chemicals requested that 
the Governor remove this, quote, "regulatory block" to the sale 
of one of its products in California, and as the Chairman 
indicated, direct his agencies to approve the material by 
edict. 

One month later, one month following that letter, the 
Governor directed — issued a directive to HCD and the Building 
Standards Commission to adopt building standards approving CPVC 
in California. 

In that proceeding there was again a broad coalition of 
labor, environmental groups, public agencies, Members of this 
Legislature, asking the Commission not to take action without at 
least completing the environmental studies that had been 
commenced in 1989. 

That testimony was ignored. There was no response. I 
ask anyone to review the records. There was no response to the 
substantive issues that were presented in that proceeding. 

The only expert testimony on the public health and 
safety testimony impacts of the pipe was presented by experts on 
behalf of this public interest coalition. The Department, B.F. 
Goodrich presented only government relations people who said 



I 



83 

that it was a great product and ought to be approved. 

So, there's never been a response to the public 
comment, the expression of — overwhelming expression of public 
concern about the impacts of this material in California homes. 

And for those reasons, we believe that this was a 
decision which put political expediency above the public health 
and safety. And for those reasons, we think any participants in 
that decision should not be reappointed. 

CHAIRMAN LOCKYER: Other comments. 

MR. CARTER: I would only make other comment. 

Even Senator Marks sent a letter in March of this year, 
asking that the EIR be fully addressed. The action by the 
Commission shortly after that was to approve it. He didn't even 
get a response. This is from one of your own colleagues. 
That's also in the file. 

MR. PATTON: Mr. Chairman and Members, I'm Gary Pat ton, 
the General Counsel of the Planning and Conservation League. 

I am here by letter and then now in person to urge you 
not to confirm these two appointments. 

I listened with great interest to the Regional Water 
Quality Board deliberations that you just had, and that seemed 
to show a possible long-term pattern which needed to be 
corrected. Far better to correct something that's wrong in the 
first instance, when you can see that something is wrong. 

Very frankly, Mr. Chairman and Members, PCL has been 
concerned and active on this very issue, and I was flabbergasted 
to find what the Commission did. 

We personally commented in that proceeding. I never 



84 

received any response whatsoever. And we are now forced, 
frankly, by the lack of response and responsiveness on very 
critical environmental and public health and safety issues, to 
essentially start a lawsuit which costs everybody a lot of 
money, and certainly the people of the State of California, as 
well as the private parties who've had to be involved in it. 

This was an issue that did come before the Legislature, 
and in fact, Mr. Baca's bill, which I lobbied against in its 
original form, suggested that the State Legislature should just 
override these very serious health concerns and mandate that 
this plastic pipe could be used everywhere. 

And the Legislature did not adopt that approach, I 
think very properly. The bill was narrowed to handle a very 
specific problem where there was some demonstrable evidence 
supporting the use of the plastic pipe material, and we removed 
our opposition. The bill did pass. It was signed into law. 

And then, frankly, after the Legislature, I thought, 
had sort of really said what the approach ought to be, which is, 
you did need to really study this before you tried some broad 
scale rubberstamp of this material, the Building Standards 
Commission, under the direction of the Governor now — and I 
knew nothing about that — just said, sure, go ahead and do it. 

It is offensive, and frankly, it puts us in jeopardy in 
terms of public health and safety. We believe we think it needs 
to be studied. It was studied, but never concluded through the 
normal process, and we think it is important for you to send a 
message this is not the way government should operate in our 
state. 



85 

MR. PRICE: Mr. Chairman and Members, Pete Price, 
representing the California League of Conservation Voters. 

We don't often get involved in appointments to 
nonenvironmental agencies, but in this case are two issues that 
have brought us here today, safe drinking water and the 
California Environmental Quality Act. 

The use of this plastic CPVC pipe and the glues that 
join it together to carry drinking water to homes needs to be 
investigated before -- so we can know the public health effects, 
if there are any. 

That's not just League's opinion. As you've heard 
before, that's the position of the Department of Housing and 
Community Development, at least it was at one time before 
politics was injected here. That's why HCD initiated 
preparation of the environmental impact report. They could have 
decided to issue a negative declaration and move forward. They 
didn't decide that. 

They decided we needed to take a full look at the 
public health and environmental impacts of this type of pipe. 
In fact, they issued this draft EIR that you've heard referred 
to that raised particular concerns about the possibility of 
carcinogenic leaching from the pipes into the drinking water. 

Now, rather than finish the EIR, the plastic pipe 
industry last year chose to sponsor legislation to allow the use 
of plastic pipes statewide without the completion of the EIR. As 
you have heard described by Gary Patton, that bill was 
drastically narrowed, and appropriately so, by the Legislature 
to deal with very specific communities that had an existing 



86 

problem with their pipes. 

Mr. Chairman, I want to speak about safe drinking water 
for a moment. In poll after poll of the public, both in 
California and nationwide, the environmental public health issue 
of greatest concern to the public is safe drinking water. 

The process that brought us here today has ignored the 
law, and it's ignored the concerns of millions of Californians. 
And we'd be failing in our duty here if we failed to represent 
those millions of people who care about safe drinking water. 

Thank you. 

CHAIRMAN LOCKYER: Tell me one time about Assemblyman 
Baca, when was that bill? 

MR. PRICE: Last year. 

CHAIRMAN LOCKYER: The number was what? 

MR. PRICE: AB 151. 

CHAIRMAN LOCKYER: When was it narrowed, in this house 
or over there? 

MR. PRICE: That was in the Senate, 

CHAIRMAN LOCKYER: Thank you. 

MR. LEHTONEN: Mr. Chairman and Members, my name is 
Steve Lehtonen, and I'm representing the Plumbing, Heating, 
Cooling Contractors of California. 

And I, too, am reluctant to come in here and oppose 
people with a long history of distinguished leadership in their 
trade and their industry. Nonetheless, I am opposing the 
confirmation of these two individuals, but not for the plastic 
pipe issue. I'm not concerned with that. 

My sole issue in this matter is that our association 



87 

has always supported the State Building Standards Commission. 
We sponsored legislation for code uniformity back in the '80s to 
do the kinds of things that Bob Raymer was talking about, and we 
support the specialty codes. We think they're necessary and 
important. 

And the action taken last year with regard to the UMC 
and lAPMO was just unnecessary. The law stated both 
organizations. It said "and", and there was a way around that. 
They could have let them both publish the UMC. 

I felt that it was a leadership decision, and the 
Commission chose to select ICBO, and I felt like that — if 
there was going to be a change, it should have been made in the 
Legislature. 

Thank you. 

CHAIRMAN LOCKYER: Thanks. 

MR. VERMEULEN: Mr. Chairman, my name's Phil Vermeulen, 
representing the California Legislative Conference of the 
Plumbing, Heating and Piping Industry, representing 
approximately a thousand contractors in the state. 

Everybody has spoken about the plastic pipe issue. I 
would add one thing. And that is, there's something — if you 
haven't heard about it, you will soon. It's the issue of ABS 
pipe and the problems in approximately thousands of homes in 
California. They estimate it's going to be billions of dollars 
of cost. 

This is an issue where ABS pipe was installed on all 
these homes as drainpipe, and the manufacturers back in the mid 
'80s decided to save a few backs and started putting nonvirgin 



88 

resins in. In other words, they were recycling. 

What happened was, when the glues were used and it was 
put together, the pipe immediately startled cracking. Even in 
my subdivision in Roseville, there are homes with this problem. 
You have to rip up slabs. It's going to be one heck of a mess. 

The point I'm trying to make is, if we go down the line 
with this plastic pipe, I guarantee you somewhere along the 
line, the manufacturer is going to start cutting corners. We're 
going to have the same problems, irrespective of the other 
problems of the health and safety, which we are deeply concerned 
about as well. 

Again, we tried to bring these issues up in front of 
the State Building Standards Commission this year to no avail, 
which deeply concerned us. 

The other issue, obviously, is the ICBO-IAPMO issue, 
which Mr. Lehtonen just spoke about. Our concern there is that 
the ICBO version is slightly different than the lAPMO version. 
The liability issue for our contractors, the building officials, 
and everybody else that's used to using the lAPMO version, there 
are potential problems down the line. 

Again, we urged the Building Standards Commission not 
to do what they did because there wasn't a need to do that. But 
our pleas went to no avail. 

For those reasons, we would urge your nonconfirmation 
of these two individuals. 

Thank you. 

CHAIRMAN LOCKYER: Is there anyone else who hasn't had 
a chance to comment. 



89 

If you want to say anything in response, please feel 
free. Tell us how all those people that are for you, you 
disagree with them, or is it the other way around. 

MR. CANESTRO: I think some points of clarification are 
necessary. 

Let me start with the issue when the first — HCD first 
submitted their proposal for CPVC, Mr. Tom Adams of the 
Cardozo-Adams firm here in Sacramento submitted a complaint 
against that regulation and asked the Building Standards 
Commission not to approve the proposal. 

During that meeting, which there is a record of that 
meeting and tape if you'd like to listen to it, during that 
meeting, Mr. Adams withdrew his letter and said that he was 
concerned about the safety of employees more than he was the 
issue of — that was stated in the letter. So, that was 
withdrawn at that time. 

So, the Commission proceeded to move forward very 
carefully, but more forward. We did. We had public hearings, 
went through the process that's required by EPA, and finally 
made the recommendation, confirm the recommendation of HCD. 

CHAIRMAN LOCKYER: Weren't there, at least if not at 
that particular moment, letters earlier raising environmental 
toxicity issues from some of these environmental organizations? 

MR. CANESTRO: There wasn't ~ I don't recall at that 
meeting. Senator. But certainly, we felt that Mr. Adams was 
taking the lead on this objection to the regulation. 

CHAIRMAN LOCKYER: But he was objecting to employee 
exposures. 



90 

MR. CANESTRO: To everything in that letter. 

CHAIRMAN LOCKYER: But I mean in the comment to the 
Commission. 

MR. CANESTRO: Yes, in part that's true. And he came 
to closure with HCD that they would prepare some additional 
requirements for employees. 

With respect to the Mechanical Code, the Mechanical 
Code was -- we made that decision, as I explained previously, 
and we selected what we thought was the most compatible code 
based upon the nine point criteria in the family of building 
codes for California. We knew that we're not going to be 
popular with one organization or the other. We made a choice. 
We felt right choice. And to this day, I think it's the right 
choice. 

They, the Pipe Trades Council and lAPMO have taken 
exception to that particular action. They filed a writ with the 
courts here in Sacramento and went to Superior Court. And Judge 
Tuckerman ruled that the Commission's action was appropriate, 
and was not inappropriate, was consistent with the law and the 
mandate of the Building Standards Commission. So, we feel 
that — that is under appeal, I might add, as we speak. 

In the final note from my notes, the gentleman, the 
last gentleman who spoke, indicated that ABS was brought before 
the Building Standards Commission on that problem, and that was 
not true. It has never been on the agenda, the issue of ABS and 
AES usage in California in recent years. 

Some years ago it was of concern, but recent years, the 
past eight years that I recall, that has never been brought 



91 

forward. So, it may have been brought to another commission, 
but it certainly wasn't ours. 

CHAIRMAN LOCKYER: It was allowed some long time ago, 
fifteen years or something. 

MR. CANESTRO: Actually, it's been in the Uniform 
Plumbing Code back in the early '60s. It's been allowed in that 
Plumbing Code. 

The same CPVC. It's been allowed for many, many years, 
but excluded because of this court action in the early '80s. 

CHAIRMAN LOCKYER: Did you want to add anything, sir? 

MR. STORCHHEIM: Again, you know, the approval listings 
that we honor, generally speaking, for building officials and 
building departments is those listings with research done by 
lAPMO in their codes. 

When these problems occurred that were reported, these 
materials and these firms were de-listed. We immediately took 
action at the local level to stop approving those products. 

As far as the Mechanical Code, as Mr. Canestro has 
stated, you know, they're concerned about a family code that 
works together. To have that family code work together, we need 
to be assured that there will be communication and sensitivity 
towards that. 

At one of the hearings, I did ask whether that could be 
assured with either code. And I got no answer to that. 

As far as the groups that formally opposed plastic 
pipe, we had this one group and we had the copper development 
industry that testified. 

As far as the CEQA question, the environmental 






92 

question, we did ask. We were given by HCD an opinion by the 
California Legislative Council. Our question was, does CEQA 
still apply? Are we constrained to do the EIR, environmental 
impact report, completed? We were told by CEQA and legal 
counsel, no, because of this legislation we were not 
constrained. 

CHAIRMAN LOCKYER: The Baca legislation? 

MR. STORCHHEIM: Yes. So, this is what compelled us, 
you know, to take the action we're taking. It's being appealed 
right now, and it will be heard. We're very sensitive to that 
and we'll pay heed to it. 

In closing, again, this issue with the Mechanical Code, 
we feel that there is a solution to bring these organizations 
together. And while they should, from a business point of view, 
every Commissioner has stated that that's a preference, and we 
commit — I commit and I think all the Commission commits to 
taking the most concerted effort possible to look for ways to 
bring them together. 

CHAIRMAN LOCKYER: Thank you, gentlemen. 

Well, what's the thought of the Committee? Any 
comments here. 

I have a couple of concerns. One is, I'm disturbed by 
the apparent political motivations that came from the top. I 
don't mean you gentlemen. I don't think you probably were even 
aware that this letter was in the file and affected somebody's 
attitudes or behavior. But it worries me. 

I think I'd like to make sure that the next governor 
has a fresh opportunity to rethink the entire issue, which leads 



93 

to a problem, because your termS/ if confirmed, would run to the 
end of the century and overlap with the next person. And it's 
just my own sense of this, that it would be prudent to not 
confirm anymore appointments that will run that long of this 
sort, and let the next governor take a fresh look at the 
situation. 

I have absolutely no doubt that you both have 
impeccable credentials and careers that merit our respect. And 
so, I don't mean to in any way denigrate your personal 
accomplishments that are quite substantial. 

I guess that's over summarizing, but it's the 
conclusion that I have reached from the discussion. 

Senator Ayala or Senator Petris? 

I guess what I would do would be, in the circumstance, 
to move that we hold both nominations in the Committee, and not 
provide Senate consent to the confirmation. I think that's the 
right way to phrase the motion. 

I'd be happy to have an amendment or turn it around, if 
that would be helpful. 

Any other thought? 

SENATOR PETRIS: So move. 

CHAIRMAN LOCKYER: Do you want to vote on that matter. 

So, I think the holding would be a yes vote, and I 
think it's the way that comes out. 

MR. CANESTRO: Thank you. Senators for your indulgence. 

CHAIRMAN LOCKYER: Thank you, gentlemen. I wish that 
circumstances were different. We appreciate the many years of 
service you've put in. 



94 



Call the roll. 

SECRETARY WEBB: Senator Ayala. 

SENATOR AYALA: Aye. 

SECRETARY WEBB: Ayala Aye. Senator Lewis. Senator 



Petris 



SENATOR PETRIS: Aye. 

SECRETARY WEBB: Petris Aye. Senator Beverly. Senator 
Lockyer. 

CHAIRMAN LOCKYER: Aye. 

SECRETARY WEBB: Lockyer Aye. Three to zero. 
[Thereupon this portion of the 
Senate Rules Committee hearing was 
terminated at approximately 5:40 P.M.] 
— ooOoo — 



95 

CERTIFICATE OF SHORTHAND REPORTER 
* 

1, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California, do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 



^ 



IN WITNESS WHEREOF, I have hereunto set my hand this 
day of f jA-^^^o^ 1996. 





/l^VELY^sT J. MLZAK ^ 
Shorthand Reporter 



308-R 

Additional copies of this publication may be purchased for $4.00 per copy 
(includes shipping and handling) plus current California sales tax. 

Senate Publications 

1020 N Street, Room B-53 

Sacramento, CA 95814 

(916)327-2155 

Make checks payable to SENATE RULES COMMITTEE. 
Please include Stock Number 308-R when ordering. 



LS'oo 



SEP 1 8 1996 

PUBLIC LIBRARY 



^ 



^HEARING 

SENATE RULES COMMITTEE 

STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 

MONDAY, AUGUST 19, 1996 
5:02 P.M. 



309-R 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 



MONDAY, AUGUST 19, 1996 
5:02 P.M. 



Reported by 



Evelyn J. Mizak 
Shorthand Reporter 



11 



APPEARANCES 

MEMBERS PRESENT 

SENATOR WILLIAM LOCKYER, Chair 

SENATOR ROBERT BEVERLY, Vice Chair 

SENATOR RUBEN AYALA 

SENATOR JOHN LEWIS 

SENATOR NICHOLAS PETRIS 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 

PAT WEBB, Committee Secretary 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

VOTE ONLY 

GARY T. ARANT, Member 

California Regional Water Quality Control Board 

San Diego Region 

CHARLES E. BADGER, Member 

California Regional Water Quality Control Board 

San Diego Region 



i 



Ill 

INDEX 

Page 
Proceedings 1 

Governor's Appointees; 

GARY T. ARANT, Member 

California Regional Water Quality Control Board 

San Diego Region 1 

CHARLES E. BADGER, Member 

California Regional Water Quality Control Board 

San Diego Region 1 

Motion to Confirm Both Appointees 1 

Committee Action 2 

Termination of Proceedings 2 

Certificate of Reporter 3 



I 



P-R-0-C-E-E-D-I-N-G-S 
— ooOoo — 

CHAIRMAN LOCKYER: All right, the next two are 
gubernatorial appointees for vote only. We had two members of 
the Regional Water Quality Board. 

The transcript is in front of you. They were heard at 
the previous meeting. We did not go to a vote because of the 
Republican Convention. 

There were times on a number of issues that there 
wasn't a full panel, and it seemed like it was better to wait. 

SENATOR BEVERLY: Move recommendation to confirm to the 
appointments of Arant and Badger. 

CHAIRMAN LOCKYER: Okay, we have a motion to confirm 
them. 

SENATOR BEVERLY: Did Senator Kelley appear? 

CHAIRMAN LOCKYER: Yes, he introduced one of them. 

Discussion among Members? 

Call the roll. 

SECRETARY WEBB: Senator Ayala. Senator Lewis. 

SENATOR LEWIS: Aye. 

SECRETARY WEBB: Lewis Aye. Senator Petris. Senator 
Beverly. 

SENATOR BEVERLY: Aye. 

SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

CHAIRMAN LOCKYER: No. 

SECRETARY WEBB: Lockyer No. Two to one. 

CHAIRMAN LOCKYER: I think we'll hold them in 
Committee. 



SECRETARY WEBB: Petris No. Two to two. 
[Thereupon. This portion of the 
Senate Rules Committee hearing was 
terminated at approximately 5:20 P.M.] 
— ooOoo — 



CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California, do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 



c^b 



IN WITNESS WHEREOF, I have hereunto set my hand this 
_ day of /^lA^cj:^y'ik<iJ' , 1996. . 




iVELYN^ J. J^IZAK ^ 
Shorthand Reporter 



309-R 

Additional copies of this publication may be purchased for $2.75 per copy 
(includes shipping and handling) plus current California sales tax. 

Senate Publications 

1020 N Street, Room B-53 

Sacramento, CA 95814 

(916)327-2155 

Make checks payable to SENATE RULES COMMITTEE. 
Please include Stock Number 309-R when ordering. 



t^A> -23 



SEP 1 8 1996 

PUBLIC LIBRARY 



# 



^^ HEARING 

SENATE RULES COMMITTEE 



^ 



-<^^/ 



STATE OF CALIFORNIA 




STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 

MONDAY, AUGUST 26, 1996 
3:22 P.M. 



310-R 



SENATE RULES COMMITTEE 
STATE OF CALIFORNIA 



HEARING 



STATE CAPITOL 

ROOM 3191 

SACRAMENTO, CALIFORNIA 



MONDAY, AUGUST 26, 1996 
3:22 P.M. 



Reported by 



Evelyn J. Mizak 
Shorthand Reporter 



i 



11 



APPEARANCES 

MEMBERS PRESENT 

SENATOR WILLIAM LOCKYER, Chair 

SENATOR ROBERT BEVERLY, Vice Chair 

SENATOR RUBEN AYALA 

SENATOR JOHN LEWIS 

SENATOR NICHOLAS PETRI S 

STAFF PRESENT 

GREG SCHMIDT, Executive Officer 

PAT WEBB, Committee Secretary 

RICK ROLLENS, Consultant on Bill Referrals 

NANCY MICHEL, Consultant on Governor's Appointments 

ALSO PRESENT 

JOHN H. MULLER, Member 

California Regional Water Quality Control Board 

San Francisco Bay Region 

SENATOR QUENTIN KOPP 

PAUL PERKOVIC 

Montara Sanitary District 

DENNIS COLEMAN 

Half Moon Bay City Council 

VICTORIA L. BRADSHAW, Director 
Department of Employment Development 

GARY ROSS, Legislative Representative 
Department of California 
American Legion 

DON HARPER, Chair 

Veterans Statewide Committee 

California Employers Advisory Council 

JULIANNE BROYLES 

California Chamber of Commerce 



Ill 



BERT CORONA, Executive Director 
Hermandad Mexicana Nacional 

WILLIE WASHINGTON 

California Manufacturers Association 

MARGA MORALES, Deputy Labor Commissioner 
Targetted Industries Partnership Program 

JOSE MILLAN, Assistant Labor Commissioner 
State of California 

HERMELINDA SAPIEN, Deputy Director 
Center for Employment Training 

ERNIE FLORES, Vice Chairman 

La Cooperativa Campesina de California 

GEORGE ORTIZ, Corporate President 
California Human Development Corporation 
Western Lands of Farmworker Advocates 

PETER R. BIRD, President 
Veterans Employment Committee 

CHARLES WILLIAMS, Chairperson 

Northern California Veterans Employment Committee 

MICHAEL S. JONES, Director 
Research and Development 
Proteus, Inc. 

JOHN REECE, Member 

State Employment Committee 

AmVets 

GLEN HALSEY, Past State Commander 
Disabled American Vets 



IV 

INDEX 

Page 

Proceedings 1 

Governor's Appointees: 

JOHN H. MULLER, Member 

California Regional Water Quality Control Board 

San Francisco Bay Region 1 

Introduction and Support by SENATOR QUENTIN KOPP 1 

Background and Experience 3 

Questions by CHAIRMAN LOCKYER re: 

Date of Appointment 4 

Witnesses in Opposition: 

PAUL PERKOVIC 

Montara Sanitary District 4 

Questions by CHAIRMAN LOCKYER re: 

Issues before Board That Would 

Raise Potential Conflict 7 

Letter to Sewer Authority 

MidCoast Side Board 8 

Approval of Executive Director's 

Action by Board 9 

Requirement to Abstain on Any Potential 
Conflict of Interest Issues 10 

Questions by SENATOR AYALA re: 

Ineligibility of Farmers to Serve on 
Boards because of Land Ownership 11 

Control of Water Quality Versus 

Water Quantity 13 

DENNIS COLEMAN, Member 

Half Moon Bay City Council 16 

Questions by CHAIRMAN LOCKYER re: 

Constraints in Decision Making Due 

to Funding Sources being Earmarked 20 

Monitoring and Repermitting, Rather 

than Enforcement Activities 20 



Most Difficult Decision during 

Tenure on Board 21 

Landfill Permit Extension 21 

Selenium and Other Such Problems 21 

Amount of Personal Time Devoted 

to Board Work 22 

Questions by SENATOR AYALA re: 

Number of Acres Owned Personally 24 

Questions by CHAIRMAN LOCKYER re: 

Land Encumbered by Williamson Act 24 

Knowledge of Proper Action on Issues 

that Might Affect Personal Property 

Interests 24 

Errors on Economic Interest Form 25 

Motion to Confirm 26 

Statements by CHAIRMAN LOCKYER re: 

Lack of Sufficient Evidence of 

Misdeeds or Conflict ; 26 

Committee Action 27 

VICTORIA L. BRADSHAW, Director 

Economic Development Department 27 

Background and Experience 27 

Questions by CHAIRMAN LOCKYER re: 

Federal Government's Role in El Monte 

Raid on Illegal Garment Business 33 

Continuation of Background and Experience 33 

Questions by CHAIRMAN LOCKYER re: 

Effects of Federal Changes in 

Job Training Budget 34 

Effects of Federal Changes in 

Welfare Budget 36 

Recipients of Grants for Industry- 
Specific Training 37 



VI 



Number of Positions in System 

with Information Available to Applicants 38 

Other Responsibilities Regarding 

Effects of Welfare Reform 39 

List of Employees Owing Child Support 39 

Questions by SENATOR AYALA re: 

Impact of Federal Welfare Reform 

Legislation 40 

Removal of Benefits for Illegal Aliens 40 

How Legal Aliens Become Eligible for 

Benefits 41 

Employers Operating Underground 41 

Collection of Delinquent Taxes 42 

Questions by SENATOR PETRIS re: 

EDO's Contracting Out with CSUS 

without Seeking Competitive Bids 43 

Figures on New Jobs and Job Creation 44 

Use of Alternate Base for 

Unemployment Claims 45 

Use of Movable Base for Unemployment 

Claims 46 

Underground Economy 46 

Questions by CHAIRMAN LOCKYER re: 

Enforcement Actions regarding 

Underground Economy 47 

Perspective on Unemployment Insurance 48 

Any Significant Unemployment Office 

Closures 50 

Cut in Federal Funds 52 

Appropriate Benefit Levels for 

Unemployment Insurance 53 

Prevailing Wage 55 

Problem with EDO's Submission for 

Title IV (c) Funds for Veterans 57 



Vll 



witnesses in Support: 

GARY ROSS, Legislative Representative 

Department of California 

American Legion 59 

DON HARPER, Chair 

Veterans Statewide Committee 

California Employers Advisory Council 60 

JULIE BROYLES 

California Chamber of Commerce 60 

BURT CORONA, Executive Director 

Hermandad Mexicana Nacional 61 

WILLIE WASHINGTON 

California Manufacturers Association 62 

MARGA MORALES, Deputy Labor Commissioner 

Targeted Industries Partnership Program 62 

JOSE MILLAN, Assistant Labor Commissioner 

California Department of Labor 63 

Questions by CHAIRMAN LOCKYER re: 

Amount of Time Working with 

Appointee on Daily Basis 63 

Problem with Appointee's 

Haughtiness 64 

HERMELINDA SAPIEN, Deputy Director 

Center for Employment Training 64 

Questions by CHAIRMAN LOCKYER re: 

Type of Help Received 65 

Amount of Funding 65 

ERNIE FLORES, Vice Chairman 

La Cooperativa Campesina de California 65 

Questions by CHAIRMAN LOCKYER re: 

Examples of Disagreement with 

Director • s Decisions 68 

GEORGE ORTIZ, Corporate President 

California Human Development Corporation 69 

PETER BIRD, President 

Veterans Employment Committee, Sacramento 69 



I 



Vlll 



CHARLES WILLIAMS, Chairperson 

Northern California Veterans Employment Committee .... 70 

MICHAEL JONES, Director 

Research and Development 

Proteus , Incorporated 71 

JOHN REECE, Member 

State Employment Committee 

AmVets 71 

GLEN HALSEY, Past State Commander 

Disabled American Veterans 72 

Questions by CHAIRMAN LOCKYER re: 

Source of Funding for Grants to 

Farmworker Programs 72 

Possible Expansion of Monies Available 73 

Any Programs that Were Cut 73 

Statement of Intent by CHAIRMAN LOCKYER to 

Hold Confirmation in Committee and Take 

Vote at Later Date 74 

Termination of Proceedings 75 

Certificate of Reporter 76 



• P-R-0-C-E-E-D-I-N-G-S 
— ooOoo-- 

CHAIRMAN LOCKYER: To accommodate audience members who 
have joined us, I think we should probably wait until later for 
the 34 or 33 items that are on our agenda, it's sort of 
administrative work, and do a couple of confirmations that I 
think people are here for. It's my understanding, Ms. Bradshaw, 
that Mr. Muller has some opposition testimony, which I think is 
untrue of your circumstance, so I'd like to begin with that one. 

We'll start with Mr. Muller and Senator Kopp. 

SENATOR KOPP: Thank you very much, Mr. Chairman, 
Members of the Committee. 

I'm pleased to present to you for recommendation and 
confirmation Mr. John Muller. I have known Mr. Muller 
approximately ten years. The district I represent ends right at 
the line of the City of Half Moon Bay. Necessarily, I spend 
some amount of time in and around Half Moon Bay, certainly I 
spend time in and around Princeton by the Sea, and Moss Beach, 
and Montara, which are part of the same general area. 

I am familiar with Mr. Muller personally. I'm also 
familiar with his reputation in the community. His reputation 
for truth and veracity is of the highest order. 

He is a successful community participant, not only in 
terms of his own private business activities, but in terms of 
participation in community activities and in area activities. 
He's acutely intelligent. He understands the nature of issues. 

I am aware of the fact that apparently some objection 
has been made to his appointment on legal grounds of some sort. 



I'm familiar with the substance of those grounds. Obviously, I 
leave it to the Committee to evaluate it, but from my 
standpoint, the asserted grounds are not valid. They're not 
just or fair to Mr. Muller. 

Just as way of background, the City of Half Moon Bay 
and the area around it, particularly the City, has been the 
location of differences of opinion about land use for probably 
twenty years, two decades easy. I can recall as a lawyer 
personally representing property owners in a section of the 
City of Half Moon Bay, known as Alsace Lorraine, opposing 
imposition of an assessment district, appearing before the City 
Council, which wasn't pleased by my threat to litigate the 
propriety of the assessment district. That's just a personal 
experience. 

There's an ebb and flow to who controls, Mr. Chairman 
and Members of the Committee, the City Council, and there are 
constant plebecites on one thing or another. Now that's all 
just. 

CHAIRMAN LOCKYER: Who's for the pumpkins? Everybody? 

SENATOR KOPP: I think everybody's for the pumpkins. 

And Senator Ayala, you ought to see those pumpkins, and 
Senator Beverly. They are humongous . 

But that debate on the merits is one thing. But to 
attribute or to allege improprieties in the nature of this 
appointment to the Regional Water Quality Control Board is a 
matter of a different stripe, an unfair stripe, an inapplicable 
stripe because nobody has, to my knowledge — and I read the 
Half Moon Bay Review every week faithfully -- no one has ever 



attributed lack of integrity, or dishonesty, or improper conduct 
to Mr. Muller in the pursuit of his private or public affairs. 

In short, Mr. Chairman and Members of the Committee, I 
recommend confirmation of Mr. Muller strongly, and I transmit my 
personal assurance to you of his own personal honesty and 
integrity. 

Thank you for taking the matter out of order. 

CHAIRMAN LOCKYER: Thank you. Senator. 

If there's an opening statement you'd like to begin 
with, it's certainly appropriate to do that. 

MR. MULLER: Thank you, Mr. Chairman. Thank you. 
Senator Kopp. 

Mr. Chairman, honorable Committee, my name is John 
Muller. I reside at 923 Mira Monte Street, Half Moon Bay. I'm 
a native son who's lived his entire life on the coast side. 

My wife and I own and operate Daylight Nursery, a fresh 
flower operation. We also grow pumpkins. Our family will be 
celebrating 50 years in business in January, 1997. 

I've spent given my whole life to agriculture, my 
community, my country. And as evidenced by my occupation, my 
involvements and my service to my country in Vietnam, I'm here 
before you pending my confirmation to the Regional Water Quality 
Control Board, San Francisco Region, to further serve 
government . 

Thank you. 

CHAIRMAN LOCKYER: Thank you very much. 

We have a list of questions that might be relevant to 
ask but that are just sort of general philosophy. 



PerhapS/ as a way to focus on whatever issues have 
contributed to controversy, I might ask first — and you can 
stay and take notes and answer, if you wish, at the 
conclusion -- anyone present who would wish to make any 
comments, either in support or opposition to the confirmation. 

Now, you've been serving since last December. Is that 
when you were appointed? 

MR. MULLER: January was my first meeting of 1996. 

CHAIRMAN LOCKYER: Okay, sir. 

MR. PERKOVIC: Good afternoon, Mr. Chairman and Members 
of the Committee. My name is Paul Perkovic. I'm a resident in 
Montara. I'm an elected official of the Montara Sanitary 
District which covers the northern portion of the service area 
for the wastewater treatment plant, the sewer authority midcoast 
side. 

I presented for you a letter signed by half a dozen 
officials in the City of Half Moon Bay, the Midcoast Community 
Council, and the Montara Sanitary District. These are 
individuals acting as individuals and not representing the 
opinions of their boards or their city. 

If I may, I'd like to read the letter to you. It's 
very brief. 

"Honorable Senators Lockyer, Ayala, Petris, Beverly and 
Lewis: 

"The undersigned are elected officials serving on 
various boards of the San Mateo County Mid-Coastside. Our local 
sewage treatment plant is regulated by the San Francisco Bay 
Regional Water Quality Control Board. The appointee, John 



Muller, and his immediate family own or control significant 
amounts of undeveloped land in this area." 

SENATOR AYALA: What are significant amounts? 

MR. PERKOVIC: I believe that the gentleman who will 
speak later will show you actual parcel maps and additional 
information that documents the property ownership and the 
transfer dates, which are, coincidentally/ very close to the 
date of appointment. 

"The Regional Water Quality Control Board decisions, 
enforcement actions, and influence can easily impact the value 
of such land. 

"As a result of its conflict of interest potential, we 
feel that confirmation of this appointment by the Rules 
Committee is not appropriate. 

"We appreciate your consideration of our input on this 
matter. " 

And the signatories are Dennis Coleman and Carol Cupp, 
members of the City Council of the City of Half Moon Bay, James 
Marsh and Richard Lohman, members of the MidCoast Community 
Council, which is a community advisory council to the San Mateo 
County Board of Supervisors, and Kathryn Slater Carter and 
myself, Paul Perkovic, who are elected members of the Montera 
Sanitary District Board. 

If I may elaborate on the letter as a personal matter 
not speaking on behalf of the co-signatories, I don't believe 
any of us is questioning the personal background or knowledge of 
Mr. Muller. I think he would be a fine appointment for a 
position in which his judgement was not brought to bear on 



matters that would have a direct influence on his personal 
property holdings. 

I think that he, just as everyone else who a resident 
of that community, has a right to advocate matters to their own 
personal economic interest, and that they can seek to develop 
their property to its highest beneficial use. 

However, I think it is inappropriate and represents a 
significant conflict of interest and a breach of the public 
trust -- and in fact, I was just reading your slogan today, "It 
is duty of the Senators to protect the liberty of the people" — 
for a person who has a direct financial interest in the 
decisions of a board or a commission to be a participant. 

And it's on those grounds, and I believe those grounds 
alone, that we, as elected officials covering roughly 20,000 
people in the a portion of the MidCoast side, which is, in fact, 
only as I can acknowledge, a part of the entire area that is 
under the jurisdiction of the San Francisco region, feel that 
this appointment is inappropriate. 

I urge that if you deny the appointment, that you 
recommend to the Governor that this candidate be considered for 
some other future appointment to a board or commission where he 
may have an opportunity to serve the public, but would not be 
put in a position of conflict of interest, or a position where 
the suspicion of conflict of interest may arise. 

I believe that it's very important that you preserve 
the public trust in the integrity of our governmental 
operations, and urge you very strongly to turn down this 
appointment. 



I thank you, and if you have any questions, I'd be 
happy to answer those. 

CHAIRMAN LOCKYER: Just a couple. 

Have there been any issues that you're aware of before 
the Regional Board in the last several months that would raise 
the question of a potential conflict? 

MR. PERKOVIC: Yes. The Sewer Authority MidCoast Side 
has been operating under a cease and desist order which was 
entered into approximately a year ago. 

CHAIRMAN LOCKYER: Who was it? 

MR. PERKOVIC: The Sewer Authority MidCoast Side. 
That's the wastewater treatment plant that serves the City of 
Half Moon bay, the Granada Sanitary District, and the Montara 
Sanitary District. Those are the areas that are represented by 
the signatures on this letter. - 

The Sewer Authority MidCoast Side Board has been 
considering alternatives that may be more economically feasible, 
long-range solutions to the water treatment needs, wastewater 
treatment needs, of the community. 

The current rate of build out that's permitted under 
the City of Half Moon Bay's local coastal plan and the County of 
San Mateo's local coastal plan indicates that the capacity that 
has been designed in the current plant expansion will last for 
roughly 25 years, at the current rates of growth, 20 to 25 
years. 

There was some consideration by members of the Sewer 
Authority MidCoast Side Board on whether the plant could more 
economically be expanded in multiple phases, so that there could 



8 

be an initial expansion now that would satisfy the discharge 
problems/ where current users during wet weather flows, there 
are some discharges that have exceeded the national waste — 
NWPES permit, the national wastewater pollution discharge 
permit, requirements for that treatment plant. And among the 
options was scaling back to meet the peak wet water needs of the 
current users with a much smaller expansion capacity. 

That plan was being discussed by members of the Sewer 
Authority MidCoast Side Board. There's a letter — I don't have 
it directly in front of me -- which appeared at the Sewer 
Authority MidCoast Side. It's my understanding, very shortly 
after Mr. Muller attended one of the Sewer Authority meeting and 
I had not had an opportunity to speak to him at that time, and 
the inference taken by some members of the board was that there 
had been some influence brought to bear on the Executive 
Director to cause a very strongly worded letter to come forward. 

And Mr. Coleman — 

CHAIRMAN LOCKYER: The letter came from? 

MR. PERKOVIC: From the Regional Water Quality Control 
Board. 

CHAIRMAN LOCKYER: About this issue? 

MR. PERKOVIC: About the proposed expansion. 

CHAIRMAN LOCKYER: And the Regional Board would have 
had to have approved their change in plan, I assume? 

MR. PERKOVIC: My understanding is that this was a 
staff letter that came out from the Executive Director. And 
that that item had not gone for a Board vote. Although, I was 
not present during that proceeding. 



CHAIRMAN LOCKYER: At some point, it would have had to 
have gone to go Board for an approval? 

MR. PERKOVIC: What would have gone to the Board would 
be a change in the schedule of the cease and desist order. So, 
if the Sewer Authority MidCoast Side, with — in consultation 
with our consulting engineer organization, Acrillo Engineers, 
and looking at the build-out rates that are anticipated and the 
needs of the three districts, if it had been possible to 
configure a smaller plant project, which would have cured the 
current discharge violations and also provided an interim 
expansion capacity, that was going to require some redesign 
time. And the Sewer Authority MidCoast Side staff had been 
working with the Regional Water Quality Control Board staff, 
it's my understanding again, to try to be able to accommodate a 
potential redesign effort that would save the three districts a 
significant amount of money. 

The project was originally budgeted at approximately 
$22 million. The district that I'm on the board of had our 
assessment district, that was intended to produce about 
five-and-a-half million dollars of the funding, challenged in 
court and it was overturned just before the project was intended 
to go out to bid. So, the Sewer Authority was left about 
five-and-a-half million dollars short of the funding and was in 
desperate need of looking at alternative means to meet the 
discharge requirements, and also to provide for a reasonable 
future growth in the community. 

But it was not necessary, in the opinion of at least 
some of the members of the Sewer Authority MidCoast Side Board, 



10 

to go to the full potential build-out of the maximum capacity 
that will ever be reached in that portion of San Mateo County. 

I'm sorry, I believe I interrupted you. I apologize. 

CHAIRMAN LOCKYER: My question was, this didn't 
actually go before the Board for a vote, but it's perhaps 
illustrative of the type of issue that might raise a conflict? 

MR. PERKOVIC: That's correct, sir. 

This particular issue had not gone before the Board. 
The cease and desist order itself, many months before, had gone 
before the Board, and that was before Mr. Muller's appointment 
to the Board. 

CHAIRMAN LOCKYER: You probably are familiar with the 
law because it's one you would have to observe as well, but just 
to make it clear, the conflict rules require abstention if 
there's a personal interest in a decision that might be made. 

I seem to recall we had the case of Gary Burke from the 
Silicon Valley who was employed by the Manufacturing 
Association, and virtually all of his members had some issue 
before. That raised a question not of the conflict potential, 
but whether he was, according to Leg. Counsel, even legally able 
to take the position, whether it filled the right slot or not. 

MS. MICHEL: Right, and he was not. 

CHAIRMAN LOCKYER: I have not seen in my experience the 
potential of a conflict being debilitating, only an issue raised 
when a person does not do what the law requires in abstaining if 
there's a relevant issue that affects a person holding an 
interest. 

But I understand your point, and I thank you, sir. 



11 

MR. PERKOVrC: Certainly, there is some concern that 
there would be influence that a member of the Board would have 
on the staff that report to that Board. Just as, in my case, 
since I'm a member of our board and we have our own staff, if 
there were an issue that I had a direct significant financial 
interest in, I'm sure members of the community would be 
concerned that my daily working relationship with our staff may 
tend to color their behavior, even though I might not vote when 
that came to a board meeting. So, that's one of the concerns in 
the community. 

SENATOR AYALA: The gentleman's representing irrigation 
and agriculture. It deals with the California Water Quality 
Control Board. 

As I recall, quality control deals with potable water, 
whether on the surface or underground, doesn't make any 
difference. In this position it has to be someone who is 
knowledgeable of irrigation and agriculture. 

Where are you going to find someone that doesn't have 
land within that district? Are farmers going to be declared 
ineligible simply because they have land to be developed? All 
they're dealing with is with the quality, not source to an area 
or moving of water flows. It's just quality. You're concerned 
about the quality of water, and again, to be redundant, whether 
it's underground or surface water. 

And this position calls for a person who deals with 
irrigation and agriculture. Where are you going to find someone 
that doesn't have acreage to deal with farming and irrigation? 

MR. PERKOVIC: Well, Senator Ayala — 



12 

CHAIRMAN LOCKYER: This is the guy responsible, or 
some predecessor, for finding the county that you live in. 
Captain Ayala found the San Francisco Bay -- 

SENATOR AYALA: Let's start with those bases. 

[Laughter. ] 

SENATOR AYALA: My question was, if we're dealing with 
someone to represent on that quality control board which deals 
strictly with quality, nothing else. I'm aware the Water 
Control Board deals with bringing water to people. This is just 
devoted to the quality of the water that's potable and 
otherwise. 

I suppose that you're going to have a hard time finding 
someone that's going to have some kind of conflict if he owns 
acreage within that region that is knowledgeable of irrigation 
and agriculture. 

MR. PERKOVIC: Well, quite frankly. Senator, I don't 
think it should be that difficult a problem because of the way 
the San Mateo County local coastal program is written. And in 
furtherance of the Coastal Act, a significant amount of the 
County area that is along the coast is very strongly protected 
for preservation towards agricultural uses. It's outside the 
urban-rural boundary. It is protected by the local coastal 
program in such a way -- 

SENATOR AYALA: And who owns — 

MR. PERKOVIC: That land may be owned by farmers and 
other agricultural interests. 

SENATOR AYALA: They're ineligible, according to what 
you're saying. 



13 

MR. PERKOVIC: No, what I'm about to say is that the 
zoning restrictions and the local coastal program and plan for 
large areas of the agricultural coast would prevent the 
development and subdivision and sale of those portions of land 
as condominiums, or as homes, or as other intense development 
uses that would tend to have a very high profit potential for 
the land developer. * 

I understand that Mr. Muller's land is under Williamson 
Act provisions so that it would not be eligible for development 
for ten years, or something like that. I'm not an expert by any 
means. 

SENATOR AYALA: If they're under contract. 

MR. PERKOVIC: I'm not an expert by any means on that. 

However, our understanding is that that there are 
holdings within the city limits of the City of Half Moon Bay, 
inside the urban rural boundary, that the zoning is such that, 
at some point in the future, it would be eligible to be upgraded 
for dense urban use, and therefore, there's a very high 
potential for economic benefit if adequate water and sewer 
supplies are ensured for that community. 

Now, I concur that it's important that the water 
quality be managed properly. And I have not had an opportunity 
to examine Mr. Muller's technical background, whether his 
educational background includes environmental science, or 
chemistry, or physics, a specialized degree that would indicate 
professional competence in soils engineering or geology that 
might be relevant for informed professional judgement on those 
matters as they come before the Board. 



14 

Nor am I aware of whether there might be other people 
in the community who would be equally or better qualified. 

However, I do believe there would be other 
agriculturally competent people who are involved in irrigating 
their agricultural lands who live in an area where they would 
not have the potential of a direct financial benefit from their 
decisions. 

My understanding is that in addition to the wastewater 
disposal/ that this Board also has jurisdiction over water 
supply issues, and that groundwater development, things like 
that. 

SENATOR AYALA: No, I don't think so. That's the 
Resources Control Board that does that, the Water Resources 
Control Board under Mr. Kennedy. 

MR. PERKOVIC: There's no concern about impacts? 

SENATOR AYALA: They're not involved with the quality 
of water. Their only concern is bringing water to where it's 
needed. 

Control Board we have referenced here, the Quality 
Control, deals strictly with quality. 

How is that going to conflict with his acreage? A lot 
of people that have acreage, and there has to be someone, 
according to what I read here, from irrigation-agriculture. 

You're eliminating a lot of people who are very 
qualified to do the job of getting quality water, not quantity. 

MR. PERKOVIC: One of the possible sources of water 
supply is by well irrigation. And a concern that has been 
raised in the community is that if there is overdraft of the 



15 

groundwater through irrigation wells that serve the agricultural 
community/ especially right along the coast, there's a 
possibility of salt water intrusion into the water supply that 
also serves the domestic water supply needs of the public. 
That's been a problem in the Carmel Valley, as I'm sure you're 
aware . 

SENATOR AYALA: This Board you're referring to, San 
Francisco Bay, is mostly concerned with the quality of the Bay 
water quality, and the Control Board is now having hearings to 
see what standards they're going to put in the Bay as they 
pertain to quality. I don't know how quality would have to do 
with quantity or where it goes. That's Resources Control Board 
that is does that. Water Resources under Mr. Kennedy. 

MR. PERKOVIC: I would think there would be a concern 
if the character of the water that was the domestic water supply 
for a community were — became saline because of salt water 
intrusion, and thus, undrinkable. 

SENATOR AYALA: That's where they come in. 

MR. PERKOVIC: At least one of the possibilities within 
our service area, the service area of the three communities for 
assisting and preventing that would be further development of 
the treatment facility so that we'd be able to use reclaimed 
water for some agricultural uses, as an example. 

I had an opportunity to have brief chat with 
Mr. Muller -- 

SENATOR AYALA: Other Members might have questions. 
Thank you. 

CHAIRMAN LOCKYER: Other questions from anyone. 



16 

Thank you, sir. 

MR. PERKOVIC: Thank you. 

CHAIRMAN LOCKYER: I believe I saw another hand raised. 
Yes, sir. 

MR. COLEMAN: Good afternoon. Senators. My name is 
Dennis Coleman. I'm a member of the Half Moon Bay City Council. 

I appreciate the opportunity to speak on this item. I 
am not a tree kisser, or a whale hugger, or any of those terms. 
I'm a businessman. As a matter of fact, I'm a Republican by 
registration. 

This is going to come down to your judgement call. All 
I can say is what I know, and that I have no financial interest 
in saying what I'm saying. 

The Regional Water Quality Board has jurisdiction over 
San Mateo County Coastside, which includes the City of Half Moon 
Bay, and it has 22,000 residents. The geography and the natural 
barriers, and the limited water and infrastructure of that area 
has resulted in very measured, very slow development, and what 
we regard as a very precious natural resource and a strong card 
for us to play in the future. 

Under current zoning, the value of development which 
could occur on our 50 percent of land that is not yet built out 
is $3 billion, with a B. Three billion dollars. 

I was elected as a reform candidate in November, 1995 
to bring a business-like evaluation to our land use instead of 
the traditional, what I regard as the good-old-boys network of 
deciding things. I'm trying to avoid even the appearance of a 
conflict of interest surrounding land use and infrastructure 



17 



1 decisions of this magnitude. 

2 For that reason I oppose the confirmation of this 

3 appointee. I would oppose Mother Teresa if She and her family 

4 had control of this much undeveloped land in the city of Half 

5 Moon Bay. This is not personal at all. This is a matter of 

6 public confidence in the government. 

7 The facts speak for themselves. Mr. Muller and his 

8 immediate family own or control at least 20 acres of undeveloped 

9 land within the city limits of Half Moon Bay. This land is 

10 zoned agricultural and open space preserve, both of which 

11 designations can be converted to residential development in the 

12 long term. 

13 Mr. Muller 's economic interests do not appear to have 

14 been completely reported on the forms required by state law. 

15 These include real estate, business, trust, and lines of credit 

16 interest over and above the residence and business income 

17 claimed. 

18 The value of the Muller and family lands can benefit 

19 greatly from long-term availability of surplus sewer plant 

20 capacity, which as Mr. Perkovic just explained, is strongly 

21 influenced by the Regional Water Quality Board's enforcement of 

22 a July, '95 cease and desist order. 

23 Various elected officials, including myself, have seen 

24 indications of influence over the Regional Quality Board's staff 

25 activities, beginning in January, 1996, one month after 

26 Mr. Muller 's appointment. 

27 Mr. Muller and his immediate family have shown a 

28 consistent pattern of promoting residential development and its 



18 

infrastructure on the coast side. Examples include 
participation of the family in the development of Half Moon 
Bay's "houses everywhere" land use plan in the years 1968 to 
1980; participation of the family in supporting the Crystal 
Springs pipeline project which brings more water for houses into 
the coast side, as well as the Coast Side County Water District 
Board. That was between 1990 and 1994. 

Mr. Muller's own participation since December, '95 in 
influencing the Regional Water Quality Board's staff to increase 
the vigor of their enforcement action, and finally, the family's 
support of the Caltrans Devil's Slide bypass proposal. 

The appointee may say that the Water Quality Board has 
not met on any item concerning our Sewer Authority since 
December, '95, and that would be correct. But I have seen 
personally the indirect influence of behind the scenes 
activities on the Water Quality Board's staff and their 
enforcement. 

Our negotiation with them stopped cold on 
February 8, 1996, when we received a letter from the Water 
Quality Board threatening us that we could not take the time to 
design a smaller plant that we could afford. If we did that 
that time, they would begin fining us. Prior to that date, they 
had been open to negotiation on that. 

That letter occurred roughly two weeks after Mr. 
Muller's attendance at a Sewer Authority MidCoast board 
meeting. I am on that board. He saw the plant manager report 
that there was flexibility in the enforcement action, that we 
could consider a smaller plant. That was stopped. Our board 



19 

was prevented from considering an item of vital importance to 
our community by that letter on February 8th from the Executive 
Director of the staff of the Water Quality Board. 

The appointee may say that the appointment is for 
agricultural seat on the Board/ but that seat can still impact 
decisions and influence of the Water Quality Board over the area 
where the appointee's family has large land assets. 

The appointee may say that the land is zoned 
agricultural and open space reserve and is now used for growing 
flowers, but it can all be converted for residential development 
if surplus sewer capacity exists in the long term. 

Finishing up, the appointee may say that he would 
recuse himself from any decisions of the Water Quality Board 
concerning the Sewer Authority MidCoast. But history says that 
Mr. Muller and his family have never recused themselves in the 
past from decisions impacting residential growth in the coast 
side. 

In closing, the choice between conflict of interest, or 
potential conflict of interest, and lack of representation by 
the appointee recusing himself is not acceptable to the voters 
that I represent. There must be a better candidate for a board 
That the coast side is so sensitive to. Give the Governor the 
opportunity of finding one. 

I urge you not to confirm this appointment. Thanks for 
considering my input, and I would answer any other questions. 

CHAIRMAN LOCKYER: Let me ask, are there questions? I 
guess not. 

Thank you, sir. We appreciate it. 



20 

Are there others that wish to comment at all for or 
against the confirmation. 

I have a couple more general questions, but if you 
would wish to comment on any of the prior testimony, now is, I 
guess, an appropriate opportunity if you would care to. 

MR. MULLER: I will answer your questions, 
Mr. Chairman. 

CHAIRMAN LOCKYER: One of the sort of generic problems 
that seems to have occurred or developed over the years is that, 
because the funding sources for the boards have become so 
earmarked, there are dozens and dozens of little funding 
streams and permit fees, and so on, that seems to have affected 
the kind of program that, if you will, comes out the other end 
of the board decision making. And the activities seem to get 
compartmentalized consistent with the funding sources. 

Have you noticed constraints of that sort in any of the 
decision making that you've yet had to address? 

MR. MULLER: No, sir. 

CHAIRMAN LOCKYER: And so, I think there has been in 
recent months or years a push by the State Board to do more 
monitoring and repermitting, rather than just enforcement 
activities, partly because the enforcement is of old permits, 
and they may not be updated. 

Has that tension been experienced on your board? 

MR. MULLER: I believe our Board, representing Region 
Two, we have a basin plan which is one of the first in the state 
that we're very proud of that I did not even work on. 

CHAIRMAN LOCKYER: Was it before you? 



21 

MR. MULLER: Yes, sir. We enforce Porter-Cologne. We 
enforce the Clean Water Act, and we do everything in our power 
to enforce people that have caused infractions for water quality 
in the San Francisco Bay Region. 

CHAIRMAN LOCKYER: What's been the is most difficult 
decision you've had to make so far as a board member? Does any 
come to mind? 

MR. MULLER: Probably giving extension to a landfill in 
Marin County, where this landfill was not lined and was 
permitted under a not lined permit. The family losing all their 
assets, and what do you do with the landfill? Where do we take 
this problem? That's a very serious problem. 

The selenium and dioxin with our refineries in our Bay 
Region is very, very important to all of us that live in 
California. And these are some difficult decisions because we 
do need petrols. 

CHAIRMAN LOCKYER: What happened with the landfill 
issue? 

MR. MULLER: We've given them one month extension to 
come back with a better report on why they are not following up 
on their reports, and we're looking at the community to do a 
better job on what they want to do with their waste, how they 
want to transfer it out of the area and not use the Martinelli 
landfill. 

CHAIRMAN LOCKYER: So, no final decision yet? 

MR. MULLER: Not on the Martinelli landfill, no, sir. 

CHAIRMAN LOCKYER: And the selenium and other such 
problems, has there been an issue before the Board in last 



22 

several months? 

MR. MULLER: If I can remember correctly/ sir, we did 
have some high contents of selenium reported by Bay Keepers, 
which is a watch-dog group that watches over the Bay. 

CHAIRMAN LOCKYER: Have you had to do something about 
that? 

MR. MULLER: We've had some mitigation with the 
refineries that have been responsible for the high levels. What 
we're doing with some great restoration projects in creeks in 
different areas with the mitigation fees are wonderful. We just 
had a classroom come in the last meeting and explain to us what 
they've done to mitigate this creek, and to clean it up, and the 
things we all should be doing in California. 

CHAIRMAN LOCKYER: How much time do you think you 
devote to service on the Board of a week or a month. • 

MR. MULLER: We get our packet, like all of you get, 
that big binder. I spend usually all day Sunday working on it. 

I'm in the flower business. I get up at midnight every 
other night, so I will get up at midnight on Tuesday nights, go 
to the flower market. My wife will relieve me about 5:00 a.m. 
and I'll shower, and put a suit on, and go to this meeting in 
Oakland and put in another six or seven hours. 

CHAIRMAN LOCKYER: So, this is every week basically? 

MR. MULLER: No, sir. Our Board meets once a month, 
the third Wednesday, and also -- unless special meetings. 

CHAIRMAN LOCKYER: So, a day-and-a-half or so a month. 

MR. MULLER: Minimum, I'd say, two days a month. 

CHAIRMAN LOCKYER: Senator Ayala. 



23 

SENATOR AYALA: Again, Mr. Chairman, I don't understand 
the argument against the gentleman simply because he owns 20 
acres in that region. I don't know how big that region is. The 
area I represent is the San Bernardino Water Quality Control 
Board — 

CHAIRMAN LOCKYER: You couldn't find 20 acres in your 
district. 

[Laughter. ] 

SENATOR AYALA.: Let me tell you, I have about 500 
dairies, and each one goes from 20 acres to 300 acres. They 
want to have a dairyman on that board so they can understand the 
problems, the issues that go before that board that deal with 
the dairy industry. 

Twenty acres out of how many acres do you represent 
sir, all together? 

CHAIRMAN LOCKYER: The whole Bay Area. It's within, 
and part of the concern is, it's within the city, 29,000 
population. I don't know what the acreage would be, or the open 
space acreage of Half Moon Bay. 

Do you have any guess about that? 

MR. MULLER: Senator Ayala, John and Anita Muller own 
1.5 acres, and our family owns 18 acres. And our family's been 
there for 50 years. 

CHAIRMAN LOCKYER: So, you own one-and-a-half acres? 

MR. MULLER: Are owned personally by John and Anita 
Muller. 

CHAIRMAN LOCKYER: And who is the -- 

MR. MULLER: My wife's family, my father and 



24 

mother-in-law. 

CHAIRMAN LOCKYER: They own the other? 

MR. MULLER: Eighteen-point-some acres. 

SENATOR AYALA: I would be concerned if the appointment 
was to the Water Control Board, the California Water Commission, 
which advises the Director of Water Resources, Mr. Kennedy, more 
so than on the quality. 

I don't know what he can do to better his position in 
terms of potential development by giving better water to the 
whole city, quality water. I don't understand. There's not 
anymore volume. They're dealing strictly with quality. 

CHAIRMAN LOCKYER: Is all the acreage encumbered by 
Williamson Act? 

MR. MULLER: That's correct, sir. 

CHAIRMAN LOCKYER: And you've not given notice of 
intent to withdraw, or anything? 

MR. MULLER: Our family's been in since May of 1996 
[sic]. We're one of the original contracts in San Mateo County. 
We're not going anywhere. 

CHAIRMAN LOCKYER: I guess for the record I'd like to 
have you comment at least on the possibility of issues coming 
before the Board that might impact your community, not just your 
own personal property, but Half Moon Bay. 

Do you have a sense of what the appropriate behavior 
would be in those circumstances? 

MR. MULLER: I think the only major issue that could 
possibly affect me on this Board is, we have the Los Trancos 
landfill, again, a major landfill in the San Francisco Bay Area, 



25 

Ox Mountain dump. It is a lined dump, but it is on tributaries 
that feed my creek. That possibly could be the only one. 

The sewer facility that I never voted on has outfall 
into the ocean, which I'm very concerned about water quality. I 
don't think that will come before us again. And if it would, I 
understand the rules of serving on boards and committees, and I 
would not vote or influence anyone. 

CHAIRMAN LOCKYER: I note that there were these errors 
in the forms you had to fill out upon assuming office. Since 
that time, you've amended your form. 

But so I could here some comment on this, first it asks 
investments not held by a business entity. Initially you 
thought you didn't have to report that. Was there an investment 
not held by a business entity that you subsequently — it was 
explained to you, or how does this work? 

MR. MULLER: I think I didn't realize it at that time. 
I think we have a line of credit on our house for an emergency 
purpose in agriculture. We had two daughters in college. We've 
never used that line of credit. That's only thing I could 
figure. 

CHAIRMAN LOCKYER: That was the nature of the 
investment? 

MR. MULLER: To my knowledge that would be one of them. 

CHAIRMAN LOCKYER: Business positions? 

MR. MULLER: Business positions, I'm not sure exactly. 
We own Daylight Nursery. We don't own the property. Our family 
owns the property. 

They are doing some future estate planning to my wife 



26 

and myself so we can keep it in agriculture in the future. 

CHAIRMAN LOCKYER: Are there other questions. 

Did you want to say anything in conclusion? 

MR. MULLER: Just thank you very much for this 
opportunity to be here, and I would hope I would be confirmed. 
I want to serve our government to the best of my ability, and I 
will always uphold all the laws of our country. 

CHAIRMAN LOCKYER: What's the pleasure? 

SENATOR BEVERLY: I'm in agreement with Senator Ayala's 
observation. I move we recommend confirmation. 

CHAIRMAN LOCKYER: I guess I might say, just as a 
general matter, I start somewhat critically of Governor Wilson's 
appointees. I just generally have lots of philosophical 
disagreements. 

And I can understand the reason for concerns of those 
in the area that can at least see the potential for undue 
influence on Water Board or other local agency decisions. 

But I'm forced to conclude that there isn't sufficient 
evidence of misdeeds or conflict that's so pervasive that it 
would be impossible to serve in an adequate way. 

I think everything one has agreed, Mr. Muller, that 
you're a man of high integrity and good intentions. 

My only other recommendation to those who were 
concerned is that it would seem to me, to the extent that the 
concerns were laid to potential land use and worries about 
overdevelopment, that in San Mateo County the best way to avoid 
that risk is to see that there's a healthy agricultural sector. 
If they're healthy and viable businesses, that more than 



27 



1 anything is probably going to be the best buttress to 

2 overdevelopment. 

3 But anyhow, that's my only thought about the matter. 

4 We have motion before us. Okay, call the role. 

5 SECRETARY WEBB: Senator Ayala. 

6 SENATOR AYALA: Aye. 

7 SECRETARY WEBB: Ayala Aye. Senator Lewis. Senator 

8 Petris. 

9 SENATOR PETRIS: Aye. 

10 SECRETARY WEBB: Petris Aye. Senator Beverly. 

11 SENATOR BEVERLY: Aye. 

12 SECRETARY WEBB: Beverly Aye. Senator Lockyer. 

13 CHAIRMAN LOCKYER: Aye. 

14 SECRETARY WEBB: Lockyer Aye. Four to zero. 

15 CHAIRMAN LOCKYER: Good luck. 

16 .MR. MULLER: Thank you, sir. 

17 CHAIRMAN LOCKYER: Next is Victoria Bradshaw to be 

18 considered as appointee to the Director of the Department of 

19 Employment Development. 

20 Did you want to start at all with any general 

21 statement? 

22 MS. BRADSHAW: I have an opening statement. 

23 First of all, good afternoon. I'm Victoria Bradshaw, 

24 and it's a pleasure being here this afternoon. As you're 

25 probably already aware, I'm the Director of the Employment 

26 Development Department, which is also commonly called EDD. 

27 EDD is responsible for several state programs, the 

28 administration of those programs: job service, unemployment 



28 

insurance/ disability insurance, and the collection of 
unemployment -- or employment related taxes. 

In addition, EDD is the state's administrator of the 
Federal Job Training Partnership Act in California which 
provides training for disadvantaged or economically 
disadvantaged workers and dislocated workers. 

EDD is also a major source of statewide and local labor 
market information. 

EDD, like almost all departments in state government 
these days, has some significant and interesting challenges 
ahead, and for EDD those include: federal block grant 
legislation; federal budget cutbacks, which for EDD in this year 
alone accounts for more than $45 million in administrative 
cutbacks. 

We are looking to ensure that we find additional ways 
to increase services to our constituencies, despite these 
dwindling resources. We are developing safeguards to ensure 
that we can effectively take our department, as well as other 
governmental issues, off of auto pilot, and we're making sure 
that the challenges to individual communities are not only 
recognized but dealt with. 

We're also trying to ensure that the concept of 
one-size-fits-all is not necessarily appropriate for our 
customers any longer. 

Prior to being appointed the Director of EDD, I was 
California State Labor Commissioner, which was my first venture 
into the public sector, and I was proud to serve as the first 
woman Labor Commissioner in the history of the State of 



29 

1 California since that position was created in 1881. 

2 As State Labor Commissioner, I believe my organization 

3 made several important contributions to the people of 

4 California/ including working for passage of the omnibus child 

5 labor bill/ which we believe tried to create a balance between 

6 developing healthy work ethics in our children as well as not 

7 sacrificing their educational opportunities. We created 

8 partnerships with other enforcement agencies to ensure that 

9 there was an increase of labor law enforcement/ despite the 

10 general fund cutbacks that we saw over the previous five years. 

11 As an example of that/ so that budget cutbacks did not 

12 necessarily translate into reductions in services or 

13 enforcement/ despite over a 20 percent increase [sic] in our 

14 funded staff positions/ we were able to increase wage 

15 collections in our Public Works Unit by over 35 percent, and 

16 increase collection in our penalties by over 17 percent. This 

17 is in spite of having a 20 percent reduction in staffing, when 

18 you compare that period to the previous five years prior to my 

19 tenure as Labor Commissioner. 

20 One of the important things I think we also did was 

21 require that all of our investigators and staff look at — honor 

22 the due process rights all the people/ the citizens who came 

23 before uS/ and to look at each case based on the factS/ not 

24 necessarily just the allegation/ the innuendoes/ the 

25 suppositions, but what really was happening in any particular 

26 case irrespective of which side of the argument was being 

27 presented. 

28 We also mounted an effective campaign to make sure that 



30 



more information was available to our employers, on the belief 
that most employers would do the right thing if they just knew 
what it was. At the same time, we tried to focus our 
enforcement efforts on those employers who were actually causing 
the problem so that we would have — we would be able to make 
sure that our resources were being used more effectively. 

And wherever possible, we tried to work out compromises 
with the many conflicting constituencies, all of whom thought 
they had the right answer. I often said to my staff, I thought 
we were either trying to herd cats or we're running a 
kindergarten many times when we tried to bring parties together. 

However, one of the most interesting events of my life 
occurred during my tenure as Labor Commissioner, and this month 
is the first anniversary of that event. If you'll bear with me 
for just a moment, I'd like to take a few moments just to 
recount to you what happened primarily because I think it is a 
good indication of what public agencies can do when they work 
together. At the same time, it's illustrative of some of the 
opportunities and challenges that still face us in the public as 
well as private sector. 

One of the investigators in the Labor Commissioner's 
Office in Los Angeles was working in the Targeted Industries 
Partnership Program, which was one of those collaborative, 
multi-agency efforts I just referred to. Anyway, this 
individual got a tip on an illegal garment manufacturing 
operation in El Monte. 

We immediately began surveillance on that particular 
operation. What made this unusual was that the tip said that 



31 

the people that were working there were being held against their 
will. 

After several days of investigation, we found out that, 
in fact, that was some pretty unusual activity, and that the 
information that we'd received appeared to be accurate, and that 
it involved some confiscated passports. Of course, we didn't 
have jurisdiction over passports, so we called INS to bring them 
into the operation. And much to our surprise, we found out that 
the investigators with the INS already knew about this and had 
been doing surveillance at this apartment complex periodically 
during the previous three years. 

Anyway, to make a long story short, we put together an 
enforcement effort involving 60 peace officers from six 
different state, local, and federal agencies, with the idea that 
we would do the enforcement action on October 2nd of 1995. 

Twelve hours before we were scheduled to begin the 
operation, I received a call from the U.S. Attorney in Los 
Angeles informing me that the operation was being called off. 
After explaining to the U.S. Attorney that she didn't have the 
authority to call off the operation because we were going in 
under state search warrants rather than federal search warrants, 
we tried to keep the INS in the operation. And after discussing 
it with them for five hours, they pulled out anyway. 

With the INS formally backing out only hours before we 
were scheduled to go in, we had to replace the 25 peace officers 
the INS was scheduled to bring in and 12 Thai translators, which 
I have to tell you is no easy feat, between 7:00 in the evening 
and 5:00 in the morning, to find 25 peace officers and 12 Thai 



32 

translators. But with the help of the L.A. and El Monte Police 
Departments and a Thai community group, the operation went on as 
scheduled. So, at 5:00 a.m. the next morning, as the electronic 
gates opened and the truck pulled out of the apartment complex, 
our peace officers went in, blocked the truck, disarmed the 
guard and the driver, and then systematically went in and 
searched each of the seven apartments in that complex. 

What we found were 72 Thai nationals who were literally 
locked in, bolted into the five apartments. Some of them had 
been there for as many as seven years. Almost all of them were 
women. They worked from 7:00 in the morning — 

CHAIRMAN LOCKYER: Why is it that you've chosen to 
dwell on this particular story? Because it was the one that was 
in the newspaper? 

MS. BRADSHAW: I'm going to get to that. 

CHAIRMAN LOCKYER: I'm just not sure that it's 
particularly relevant to your current job. 

MS. BRADSHAW: Well, I was trying to show that I'm kind 
of a hands-on person, and then even when people say, you can't 
do it, when it's the right thing to do, you go in and get it 
done. 

In this case what happened is, we had 72 people who had 
been working from 7:00 in the morning until midnight, seven days 
a week, 52 weeks a year, for seven years. And the INS didn't 
want to do it, but we went in and did it. And what we did is, we 
found over a million dollars in cash and jewelry. We went in 
the next day. We filed suit. We won the suit. We have turned 
over a million dollars back to those workers. 



33 

CHAIRMAN LOCKYER: I guess it's great you're hands-on, 
but it took six years of this administration to even find out 
about it. I guess that's not is such a great record. 

MS. BRADSHAW: Well, it took us exactly five weeks from 
the point that we found out about it, and we went and did it, as 
opposed to the federal government, who knew about it and had 
done surveillance on it for three years, and pulled out. 

My point, I guess, is that when — even when there are 
obstacles and there is a problem, at least my experience is, you 
can get enough players together, and you can build a partnership 
to get the job done. 

CHAIRMAN LOCKYER: Is there anyone present who can 
comment on the federal government's role? 

If we're going to click into the Pete Wilson criticism 
of the feds versus the wonderful state operation, we're going to 
take some time with this nomination. So, somebody who's present 
better find out what the feds have to say, or get them here to 
testify at our next hearing. Roger, you can let them know when 
the next hearing occurs, which will probably be in December. 
We'll get into that. 

. What else do you want to say? 

MS. BRADSHAW: Well, in my assignment, my new 
assignment, I think some of the strengths that I brought to my 
last assignment serve me well in this particular assignment. 
For example, I believe that I'm pro-active. I believe in 
building collaborative relationships. I believe that services 
should be relevant to the customers, and that information should 
be credible as well as cost effective. 






34 

In addition, like I said, I think that I, in fact, can 
be hands-on. That in a perfect example, I think, is the issue 
that Senator Hughes brought up. We got together with Senator 
Hughes and her constituencies. We worked through and identified 
what the real issues were. We came up with what I think are 
some pretty good and creative solutions. The result is, 
everyone is happy. We have a great, solid working relationship, 
and I've built a communication network that will allow all 
parties to successfully work in the future. 

In the case of EDD, I believe that good employee 
relations, good business policy and good public policy are not 
mutually exclusive terms. And I think one of the strengths I 
have is bringing those pieces together to make sure that there 
are positive answers as opposed to necessarily negative ones. 

CHAIRMAN LOCKYER: I want to wait until you conclude. I 
had some questions. 

One of the challenges, I guess, that we need to work 
through is the federal change in both welfare and in job 
training. Could you bring us up-to-date? Let's start with job 
training, since that's less recent. 

What are your thoughts, or what's happened to prepare 
for transitioning to the new block grant-type system? 

MS. BRADSHAW: On the job training, the work force 
development, the federal block grant legislation, for all 
intents and purposes, is dead, which makes it a little more 
problematic to do things at the state level. It doesn't make it 
impossible, but certainly makes it a little more difficult. 

There are 23 different state and federal training 



35 

1 grants that we have to deal with. And one of the things that is 

2 really required that we're really putting a lot of effort to is 

3 the One Stop, the idea that the citizens should not have to go 

4 to 15 different locations to get information, to get services, 

5 with regard to training or employment related information. 

6 And so, existing legislation, as well as really the 

7 philosophy of where the state is, is that we're trying to 

8 create, help localities, local governments, put together One 

9 Stops, and bringing in different partners so that it becomes 

10 transparent to the citizens who is responsible for what. They 

11 can simply go to a single location and have a seamless — 

12 CHAIRMAN LOCKYER: Has that happened yet? 

13 MS. BRADSHAW: That is in the process of happening. 

14 Part of it is requiring legislation, but we received a 

15 development grant. We have applied for an implementation grant, 

16 but towards that end, out of the Governor's 40 percent 

17 discretionary money over the last two years, we've funded $32 

18 million worth of projects. We have another 15 that we are 

19 scheduling, or we've put aside for this coming year with the 

20 idea to help local governments put together projects that are 

21 good for their locality. What's good in one location may not 

22 work in another. So, we're trying to let each community decide 

23 what's best for themselves. 

24 Along with that is the School to Careers, where we also 

25 got a development grant, and we have applied for an 

26 implementation grant, and that really is a collaborative effort 

27 between the school systems, both the K threw 12, as well as the 

28 community college and the Employment Development Department. 



36 

CHAIRMAN LOCKYER: So, these are federal grants you 
applied for? 

MS. BRADSHAW: Right. 

CHAIRMAN LOCKYER: Is that how that works, from DOL or 
somebody? 

MS. BRADSHAW: Right, U.S. Department of Labor. 

CHAIRMAN LOCKYER: They're kind of in the works on One 
Stop and the School to Work preparation. 

MS. BRADSHAW: Right. 

On the welfare, which is a little more interesting 
since that now has been recently signed into law, EDD's role 
primarily is providing employment-related services or increased 
employment-related services to AFDC and food stamp recipients. 

Now, in anticipation of this occurring, we began 
preparing for it actually seven or eight months ago. Along 
those lines, we began working to identify on a county by county 
basis, and where we could, even more refined than that, where 
the potential job opportunities were, where the growth was going 
to be, what occupations were going to be growing, what 
industries had potential, and then began focusing our job 
development efforts in those areas. 

In addition — 

CHAIRMAN LOCKYER: Was that not happening before? 

MS. BRADSHAW: Yeah, but it really has been working 
with the local areas also, because job training now, while it's 
supposed to be geared to that, isn't necessarily pinpointed. 
There's another area that's a little bit — makes it a little 
bit different. Most job training isn't geared to entry level. 



37 

and a lot of the AFDC recipients are going to be entry level. 
So, what we've tried to do is go back and look at those 
industries that will have a high number of entry level positions 
and focus there, as opposed to necessarily just the high tech 
areas, which tend to gets a lot of the attention. 

What we've done is, we've just recently put out $3.5 
million worth of grants to six different local communities to 
help do industry-specific training that's geared towards entry 
level, so we can begin moving — seeing what works to move people 
who are currently on aid to these entry level jobs, but designed 
specifically to localities. 

CHAIRMAN LOCKYER: Who received the grants? 

MS. BRADSHAW: Los Angeles, Sacramento, Santa Cruz, 
Orange County, Mendocino and Merced were the ones that 
competed. The idea is to see what works. 

CHAIRMAN LOCKYER: They were successful? 

MS. BRADSHAW: Yes, they were successful. 

CHAIRMAN LOCKYER: How many applied? 

MS. BRADSHAW: There were probably twice as many that 
applied. Actually, some of them even that didn't get a grant 
did have some good ideas, and we're going to go back and look at 
those to see what we can do. 

What we're trying to do is look at something different, 
because obviously, this is a different situation. A lot of 
training, as you know, is geared towards 16, 18, 20 weeks worth 
of training, and we're saying what can we do to design the 
training around what an industry needs on a very short-term 
basis so we can move people in and get them on the job training. 



38 

The other thing that we've done is, we created a new 
system that allows getting more information to more people, to 
make the connection with jobs to job openings. For example, 
we're piloting a new program in two cities to try to get 
businesses to give us entry level jobs to put on a system, and 
then allow the local welfare — our Department of Social 
Services, the local welfare departments — access to that 
information too, which we currently don't do. In less than ten 
days, we got a thousand jobs put into the system. 

So, what we're trying to do is figure out something 
that going to get to the entry level jobs. And what we want to 
do is develop the system so we mainstream people, because we 
don't want to develop a system just for people who are on aid, 
but eventually anybody who's entry level, just coming out of 
high school, just coming out of community college, wherever, 
and then build a system that's multi-useful. 

CHAIRMAN LOCKYER: How many positions are there, job 
possibilities, do you think in the whole system that that 
information is available to applicants? 

MS. BRADSHAW: Well, I don't know exactly how to answer 
that. We've not done a good job of getting information on entry 
level jobs because most of the people who come to us for job 
service aren't interested in entry level jobs. 

CHAIRMAN LOCKYER: That's what I was wondering. How 
many are entry versus the total? 

MS. BRADSHAW: We know, for example, that we are 
expecting about a half million new jobs in the State of 
California through the year 2005. About 300,000 of that is 



39 

brand new jobs, and 200,000 are jobs where someone either 
retires or dies but does not go on to another job. They leave 
their job, and they don't move on to another one. Of those, 
about 60 percent require less than a high school education or 
less than a year of experience. So, it's a significant number. 

CHAIRMAN LOCKYER; Any other responsibility that you 
would have with respect to the welfare reform proposal, other 
than trying to identify entry level jobs? 

MS. BRADSHAW: Yes. There is a requirement — well, 
labor market information, obviously, is supplying information 
and making it more available, and that we're trying to do now in 
terms of getting it on the Internet and making it more user 
friendly, so you don't have to be an analyst to figure out what 
it is. 

In addition to that, there's a requirement to make — 
currently there's 17 occupations or 17 industries where we have 
to make the connection if there's child support due. That is 
being expanded. So, that goes to the effort of the new employee 
directory when you hire somebody when you hire somebody new. 

CHAIRMAN LOCKYER: The D.A. sends you a list? How does 
that work? 

MS. BRADSHAW: An employer has to report a new hire. 
We then make the match. 

CHAIRMAN LOCKYER: You've got the list already. Do you 
get that from Social Services? How do you get the list of who's 
owing child support? 

MS. BRADSHAW: We get it from a variety of sources. It 
now only deals with 17 specific industries. That's being 



40 

expanded. There'll also be some requirements, I assume, on the 
JTPA side in terms of who's going to be eligible for training. 

Like I said, the unemployment insurance also will have 
some requirements in terms of if there's child support owed. A 
lot of the details haven't been fleshed out because it was just 
assigned this week. 

CHAIRMAN LOCKYER: Anything else on the welfare reform 
implementation? 

MS. BRADSHAW: We're doing a lot to increase the 
Intensive Services Program, and that's really to provide people 
who have significant barriers, to help them get beyond that, and 
we've changed the percentage from 25 to 75 percent so that we 
can provide more services. 

CHAIRMAN LOCKYER: Questions? 

SENATOR AYALA: I would like to ask, the Chairman 
mentioned the federal welfare reform legislation. 

What impact is that going to have in California, that 
federal legislation? 

MS. BRADSHAW: On the EDD, it'll have a fairly 
significant impact because right now, about 220,000 of people 
who register for our job service have some sort of aid 
associated with it. It'll probably go to 525,000, so that's a 
pretty significant increase. 

SENATOR AYALA: The removal of benefits for illegal 
aliens, is that going the to affect your department? 

MS. BRADSHAW: Right now, it's against state as well as 
federal law to provide employment-related service for 
undocumented or illegal, so theorhetically, we're already not 



41 



providing those services. 

SENATOR AYALA: Refresh my mind. When a legal alien 
comes to this country, he comes from the quota system, and 
someone here will underwrite his activities while he's here. 

Where does he earn these benefits that we're so 
concerned about? If he has someone here underwriting his costs 
so he won't be a burden to the government when he comes here as 
a legal alien, where do we end up? Somebody gets hurt, or they 
have a heart attack, or something that needs help, how do they 
get the benefits if they're not supposed to get them? 

MS. BRADSHAW: Well, in terms of employment-related 
services, if they're here legally, and they have the — they're 
authorized to work, they have the right to work, then they are 
entitled to the employment services. 

If they're here illegally and do not have the right to 
work, then we're not supposed to be providing any 
employment-related services to them. And we verify that. 

SENATOR AYALA: Just that reference to legal aliens? 

MS. BRADSHAW: Yes. . 

SENATOR AYALA: You mentioned the impact on our state. 

Do you have any plans as EDD Director for tracking down 
these employers or employees who are operating underground by 
failing to pay their payroll taxes? Are you going to go after 
these people that we need to be going after? 

MS. BRADSHAW: Well, actually three years ago, the 
Joint Enforcement Strike Force deals with the underground 
economy, and it's a collaborative effort between three different 
or four different agencies, all dealing in the underground 



42 



economy. 

SENATOR AYALA: There's a concerted effort to take care 
of these folks? 

MS. BRADSHAW: Right. They've been concentrating on 
the construction industry, the bar and restaurant industry, auto 
repair, garment industry, industries where there's a high 
profile of people operating underground. There really has been 
a great deal of information that's gone into that, and a great 
deal of enforcement. In fact, almost 3500 inspections have 
occurred on that. 

SENATOR AYALA: Is it legal for state to operate as 
counties do in going after these delinquent taxpayers for 
property tax? The counties can farm it out to some collection 
agency, and they get a percentage of that, but that's more than 
the county would get otherwise from these people that are 
delinquent on their property taxes. 

Do you have any system like that, that could get 
people? 

MS. BRADSHAW: One thing that we did when I was Labor 
Commissioner is, prior to licensing a garment manufacturer or a 
farm labor contractor, one thing we did was get verification 
that there was no outstanding unaddressed tax liabilities. 
Which, if there were, then we asked them to address them before 
we gave them the license. 

With farm labor contractors, the IRS, for example, got 
almost $20 million just off of farm labor contractors over the 
first three years of that particular program. So, there are 
definitely different ways of addressing that. 



43 

1 SENATOR AYALA: Thank you. 

2 SENATOR BEVERLY: Any further questions by Members of 

3 the Committee? Senator Petris. 

4 SENATOR PETRIS: Thank you, Mr. Chairman. 

5 We have information regarding the State Auditor report 

6 on state agencies that you might want to comment on. We got the 

7 report just this month. The Auditor issued the report, saying 

8 that EDD and a number of other agencies were arranging for 

9 contracts without the normal competitive bid process. And the 

10 report is entitled, "State Contracting: Reforms Are Needed to 

11 Protect the Public Interest." 

12 It points out that there are certain exemptions, but 

13 the agencies went way beyond the exemptions. One example is 

14 contracting with Cal State University without seeking 

15 competitive bids. The Auditor found that rather than using 

16 existing government resources, the departments have misused 

17 inter-agency agreements and exempt contracts to enter a 

18 sole-source contract with private parties. 

19 Now this sole-source thing has popped up before in 

20 other agencies in our hearings here. There seems to me to be a 

21 trend, running away from competitive bidding and into 

22 sole-source stuff as much as possible. 

23 The report described the state, the EDD, as using a 

24 CSU-af filiated foundation, which was eligible for an exemption, 

25 and they were funneling through the foundation. 

26 It sounds here, that's all I know about it, what I read 

27 here, looks like an end run around the competitive bid 

28 requirement. 



44 

Are you familiar with that? Can you comment on it? 

MS. BRADSHAW: Yes, I can comment on it. 

There were two contracts, both of which, I believe, 
both of which I know occurred prior to my coming on. 

I'm a firm believer in the competitive bidding process. 
Shortly after coming, I also made sure that we did not continue 
using the CSUS . In fact, I told CSUS that we would not be using 
them for purposes other than areas where they themselves were 
going to be doing the work. So, I think we have — at least my 
position is -- 

SENATOR PETRIS: Put the brakes on that? 

MS. BRADSHAW: It was my position when I was the Labor 
Commissioner, it's my position as EDD Director, and we will only 
use the California State University system when they themselves 
do the work. 

SENATOR PETRIS: I didn't catch all your testimony 
about jobs. This is a job development department. 

Did you give us any figures on new jobs, and where they 
are, how they're created? 

MS. BRADSHAW: As of November of 1995, the state 
actually made up statistically all the jobs that were lost in 
the previous five years. Most of the jobs — we are creating 
new jobs to the tune of about half a million each year, but 
that's a combination brand-new jobs, and jobs for which 
employees are leaving them, for example, retirement or death and 
not replacing them. So, there are new opportunities of just 
under a half a million jobs. In addition to that, the types of 
jobs they are depend on the location. 



45 

For instance/ the service industry is a big job 
generator. The media and the entertainment industry is a huge 
job generator. Almost all industry sectors are increasing, some 
more rapidly than others, and it really depends on which area of 
the state that you're in. Some of the agricultural or the rural 
areas have more difficulty than do some of the more urban areas. 

SENATOR PETRIS: How about mobility, especially when it 
comes to unemployment insurance? We don't use a movable base 
period in California to permit people more opportunity to draw 
the benefits while they're between jobs. 

Could you comment on that? Are we improving that? 

MS. BRADSHAW: The issue on terms of the alternate base 
period? 

SENATOR PETRIS: Yes. 

MS. BRADSHAW: The issue of the alternate base period, 
actually there was a lawsuit in the State of Illinois that was a 
Seventh Circuit decision that required the State of Illinois to 
use an alternate base period. 

We believe that actually it's a state decision as 
opposed to a judicial decision, and we believe the state, as 
do — almost all the governors have asked for federal 
legislation to make sure that it is a state's decision, and 
there are a lot of factors that go into it. And we think it is 
an issue that should be discussed at the state level. 

SENATOR PETRIS: I'm not sure I'm on the same track. 

There's another aspect of it I'm looking at here. 
First of all, it's based on the amount earned by the unemployed 
person during the first four — 



46 

MS. BRADSHAW: Of the last five. 

SENATOR PETRIS: -- of the previous five quarters. 

Sometimes they get a significant amount in the later 
quarters/ including the fifth, but they don't get enough total 
to qualify for the benefits. That knocks them out of the 
eligibility. 

I guess that's what you meant by movable base? 

MS. BRADSHAW: Yes, the movable base. 

What happens is, there are five quarters, and employers 
report it on a quarterly basis. That's why it goes by 
quarters. And there is a period of a lag period, a lag quarter, 
where the employer may not have reported the wages, so EDD 
doesn't know whether or not — what wages are at issue, have 
been earned during that lag quarter. That's the lag quarter 
that's in question in the movable base period that you're 
talking about. They may have earned more, but EDD wouldn't 
necessarily know that. 

And what the Appeals Court in the Seventh — in 
Illinois said is, you have to find some way to get that 
information. 

SENATOR PETRIS: We've had a history in California of 
underground economies, some of which are pretty good-sized 
businesses. They just don't show up on the books because they 
don't follow the law. 

I guess part of the Department's mission is to track 
those down and get them on board. Is that situation getting 
better or worse? We seem to have it in pockets? 

MS. BRADSHAW: Yes, it actually is, in certain 



47 



industries . 

SENATOR PETRIS: Garment industry, and so forth. 

MS. BRADSHAW: Garment/ construction tends to have a 
high amount of underground economy. 

As I was explaining to Senator Ayala, we have created, 
or it was created three or four years ago, three years ago 
actually/ the Joint Enforcement Strike Force/ which is a 
combination of four different agencies that work together, 
combining resources/ doing joint inspections. We've done nearly 
3500 inspections over that period of time/ concentrating in 
those industries that tend to operate underground. 

In certain industries/ such as construction/ we've 
created a parallel program to kind of address some of the 
nuances that are in construction that may not be in other 
industries so that we can/ in fact, find better ways of 
detecting the underground economy. 

SENATOR PETRIS: Are you whittling it down? 

MS. BRADSHAW: We are trying. 

SENATOR PETRIS: No fish in the net yet. 

MS. BRADSHAW: Well/ actually/ I think it's close to $8 
million in additional tax dollars have been noted/ and $13 
million in labor law violations/ or citation amounts in that 
period of time. SO/ I think we've made significant progress/ 
but it's a big job. 

CHAIRMAN LOCKYER: Did you mention earlier/ I might 
have missed this, how many enforcement actions there 've been 
with respect to the underground economy? 

MS. BRADSHAW: I mentioned it, but I'll give you the 



48 



exact . 

There have been 3,984 inspections, 2,565 Labor Code 
citations, for a total of $13,330,000 in penalties, 1,595 pay 
roll audits for $5,608,656 in unpaid taxes. 

CHAIRMAN LOCKYER: That's since when? 

MS. BRADSHAW: That's a two-year period. 

CHAIRMAN LOCKYER: Do you know what the numbers would 
have been like for perhaps the previous cycle? 

MS. BRADSHAW: It was a new, brand-new program. 

CHAIRMAN LOCKYER: So, not much enforcement prior, 
unless by a complaint? 

MS. BRADSHAW: Exactly, and it wasn't identified as 
necessarily being underground economy. 

CHAIRMAN LOCKYER: I'm sorry. Senator. I got my 
answer, and you were in the middle of asking. Had you 
completed? 

SENATOR PETRIS: There's one other question, which has 
escaped me. 

CHAIRMAN LOCKYER: I'll ask another one while you find 
it. 

Let me ask you about unemployment insurance. The 
unemployment insurance, I guess I'm mostly interested in more a 
statement of philosophy and perspective than anything, because 
obviously, whatever the law is, that's what you're obligated to 
administrate. 

Do you have any particular thoughts about the system 
that we should be familiar with, its strengths or weaknesses, 
how the levels should be set if you were advising us as policy 



49 



makers with respect to UI? Are the levels too high, too low, 
whatever? 

MS. BRADSHAW: Can I take it from two levels? One just 
administratively, and then we can talk about the benefit level. 

CHAIRMAN LOCKYER: Yes. 

MS. BRADSHAW: What we're trying to do now is make it 
easier to get through the process. There's almost — 

CHAIRMAN LOCKYER: To qualify? 

MS. BRADSHAW: To get through just to get the claim 
filed, for example. There's almost been kind of a rite of being 
unemployed, meaning a rite, R-I-T-E, that, you know, you don't 
feel unemployed unless you've spent four hours standing in line 
in an unemployment office. 

What we're trying to do is do away with that, so that 
in fact you can file by phone. Rather than spending 128 minutes 
standing in one of our offices, you can, in fact, do it in 13.8 
minutes over the phone. So, what we're trying to do is take 
away kind of the bureaucratic process and get to the nuts and 
bolts of the operation. 

CHAIRMAN LOCKYER: Is that why we get some complaints, 
though, from some communities, thinking counter service would be 
eliminated? 

MS. BRADSHAW: Right, and in fact, that's really part 
of a problem that we almost created ourselves, in that what 
we're doing is changing the method of allowing people access to 
services. We're trying to give them a choice, that in fact you 
can file in person, or you can file by phone. And that kind of 
got translated into office closure, that's not exactly what we 



50 

are doing at all. 

In fact, we're trying to find a better way to provide 
those services in light of the fact that we have dwindling 
resources, but the reality is, there's no reason that we can't 
find more customer-friendly ways of operating. What should 
drive it is the customer, not necessarily what we've always done 
or the bureaucracy. That's basically what we've been trying to 
do, is find different and more expeditious vehicles to getting 
our services to the public. 

CHAIRMAN LOCKYER: Have there been office closures of 
significance in the last year? 

MS. BRADSHAW: What we're doing is, we're taking 
facilities where — we're trying to create multi-functional 
facilities so that we can maximize what resources we have. And 
those areas that require an individual contact, job service, for 
example, where you really need to talk to the individual, those 
we're trying to keep in the communities through the One Stops, 
through our own operation working in collaboration. 

But areas where we can provide this service, like via 
mail or via phone, rather than paying for the expense of a 
building, what we're trying to do is go in with the community at 
provide those services. So, what we're looking at is not 
necessarily -- 

CHAIRMAN LOCKYER: I don't know what going into the 
community means? 

MS. BRADSHAW: On the One Stop. In fact, putting all 
employment-related -- if we have eight agencies working together 
to provide a seamless -- we don't want to be over in a building 



51 

that's completely separate and has nothing to do with it. So, 
that's basically what we're talking about. 

CHAIRM7\N LOCKYER: But they'd still get the same 
services. 

MS. BRADSHAW: Right. In fact, in some cases, we're 
trying to find better ways of giving them access to service. 

CHAIRMAN LOCKYER: So, have there been offices closed? 

MS. BRADSHAW: There have been buildings that have 
changed/ yes. 

CHAIRMAN LOCKYER: How many do you think? 

MS. BRADSHAW: To tell truth, I don't know the number. 

CHAIRMAN LOCKYER: Estimate? You probably would have 
heard complaints if there were serious numbers. 

MS. BRADSHAW: Let me give you, and it was an example 
that you and I talked about the other day. 

We got complaint that the — in fact, it was the 
Oakland State Disability Insurance Building was closing, when in 
fact, it's not. What we're doing is finding a different way of 
providing the service. 

And as I explained to your staff, we had the feeling 
that people who are sick or injured shouldn't have to come in to 
file a complaint, that they should be staying home, getting 
well, and filing the claim. 

At the same time, though, what we're doing is, we're 
building a call center in downtown Oakland because we have a 
facility there that will accommodate that. And we're making the 
capital improvements there. So, at one hand, while we are 
changing the service in one area in Oakland, we are expanding 



52 

the building in another, but we're still not closing off any 
service. We're just changing the configuration on how we're 
operating. 

So, I think it would be fair to say we've not closed 
services in any locations, although we have changed buildings. 

CHAIRMAN LOCKYER: As you would anticipate next year, 
is there any federal cut of significant moneys? 

MS. BRADSHAW: $45 million in our administrative 
budget. 

CHAIRMAN LOCKYER: Against how much? 

MS. BRADSHAW: About just over 700 million. 

CHAIRMAN LOCKYER: That's still pretty sizable. What 
will that make you do? How will you adjust to that? 

MS. BRADSHAW: We put a hiring freeze in six or seven 
months ago. We've been looking at all of our operations to make 
sure that anything that we've cut out, we've asked for 
suggestions from the employees. We will be able to make those 
cuts without — we will be able to make those cuts without any 
adverse impact, we believe, to — significant adverse impact to 
any of our programs or to our own employees, our permanent 
staff. 

CHAIRMAN LOCKYER: So, so far okay? 

MS. BRADSHAW: Right. That's what we're planning for. 
I mean, that's one reason we have a strategic plan, is to make 
sure that, in fact, we plan for our future rather than having 
our future just happen to us. 

CHAIRMAN LOCKYER: Now, you were in the middle of 
explaining about UI, and first the bureaucratic 



53 



administrative -- 

MS. BRADSHAW: The administrative side of it. 

CHAIRMAN LOCKYER: Trying to make the system better. 

What about the sort of substantive law of UI benefits, 
and what's an appropriate level? Are they too high or too low? 

MS. BRADSHAW: In terms of the benefit levels. 

You know, I think, as I've said in all of our program 
areas, I think all programs should be reviewed to make sure that 
they adapt to the changing situations. And I think welfare 
reform is a perfect example of looking at each program, whether 
it be state disability insurance, unemployment insurance, 
worker's comp., whatever, in light of what the changing 
environment is. 

And while I know there's been some interest in the 
state disability insurance, there hasn't been, at least since 
I've been EDD Director, the same interest in the unemployment 
insurance. 

And that isn't to say with welfare reform, as more 
people transition into the work, and you may have them on entry 
level jobs that have in and outs, periods of in and out, that 
there wouldn't be some necessity to look at the benefit levels. 

CHAIRMAN LOCKYER: I understand that it's wise to 
periodically review. 

What I'm trying to get at is not some commitment about 
future behavior at all, but simply if the Governor asked you for 
your best advice about SDI, about UI, what would your thoughts 
— let's stay with UI for a moment — what would your thoughts 
be. 



54 

Some have suggested, for example, there should be some 
automatic formula that ties it to whatever, manufacturing wage. 
There are different ideas about it. 

Do you have any settled philosophy about those matters? 

MS. BRADSHAW: I think I mentioned initially, I believe 
we ought to take most things off auto pilot because auto pilot 
doesn't necessarily allow us to adapt to situations. 

I think what we should be doing is look at all our 
safety nets in light of changing environments, and I believe 
welfare reform is one of those issues that requires us to relook 
at some of those things. 

I don't think necessarily tying it to any specific 
indicator from here to perpetuity necessarily allows us the 
flexibility to react to changing circumstances that are going to 
be regarded in the next three or four years. 

CHAIRMAN LOCKYER: You know, it's interesting, because 
we do have some auto pilots, just as an aside, like we 
automatically index the personal income tax schedule, and other 
auto pilots that are of benefit to taxpayers. 

I never hear about those from the administration. I 
only hear about the ones that involve some grant to a poor 
person. 

But anyhow, nothing more specific you'd care to add on 
the UI benefits themselves? What would be an appropriate 
benefit, if it's too low or too high? 

MS. BRADSHAW: No, not anything specific. 

CHAIRMAN LOCKYER: Let me ask, SDI, I'm aware that 
there's been a recommendation, I think we all know that, to 



55 

provide some form of an increase. It's a little bit unclear 
what the amount is. 

MS. BRADSHAW: It's working its way. 

CHAIRMAN LOCKYER: Yes, so that we've heard about. 
There's something happening somewhere. I'm a little fuzzy about 
where. I think maybe over in the Assembly. 

Let's shift to prevailing wage, because you did, in 
your former life, have some responsibility there, and I assume 
could wind up again being asked for advice and recommendations 
about the topic. 

Can you assess for me the good and bad features, or 
what's the debate about with respect to prevailing wage in 
public projects? 

MS. BRADSHAW: I can't — prevailing wage is not an 
issue that I have been involved with in the last eight or nine 
months, or actually the last year. Prior to that, my 
responsibility was enforcement of the laws or the regulations 
that were already in effect, not the debate with regards to what 
they should or not be. 

CHAIRMAN LOCKYER: So, you don't have an opinion about 
them? 

MS. BRADSHAW: I can't comment on what's going on now 
because I don't know. 

CHAIRMAN LOCKYER: I was not so much wanting for a 
factual description, but more just to try to understand your 
approach or philosophy. 

MS. BRADSHAW: I think I can tell you what my approach 
and philosophy was with regards to the enforcement of the 



56 

prevailing wage. Maybe that would help us get to where you want 
to go. 

I believe strongly in a level playing field. I believe 
strongly in a level playing field in any arena of labor law 
enforcement because I think the law abiding employer deserves to 
have the economic advantage, not those who are violating the 
law. 

I believe that in investigating a prevailing wage 
claim, or any issue with regards to the labor law enforcement, 
that if the facts -- if you look at the facts, if the facts show 
a violation of the law, then you prosecute it to the fullest 
extent of the law. I think that would be — I think that is 
consistent with the spirit of the prevailing wage law, and I 
certainly think it is within the spirit of any enforcement 
agency. I think it consistent with what the legislative intent 
was. 

CHAIRMAN LOCKYER: Well, to the extent, I think, that ' 
you're suggesting to people it's good to obey the law, I can't 
disagree. 

But I guess what I was trying for was a little more 
philosophy as to, if someone came to you and said, we want to 
change the law. Still be level playing field, but it's going to 
be a different level. You know, if there are impacts on the 
cyclical industries, the types of businesses involved, and 
quality of work, or any other consideration, public costs, 
whatever it might be, and how you would assess and weigh those 
factors . 

If this is too remote from the job, you know, what 



57 

you'd normally be asked to do, then I don't want to force you to 
comment philosophically on something that you may never shall 
involved in. 

MS. BRADSHAW: It certainly isn't anything to do with 
what I'm involved with now, and I wasn't asked the question when 
I was Labor Commissioner. 

CHAIRMAN LOCKYER: And you never developed opinions 
about that while you were Labor Commissioner? 

MS. BRADSHAW: I developed a lot of opinions while I 
was Labor Commissioner, and one of them was that, in fact, 
creating a level playing field was an important issue. That 
certainly the issues of what went into the law or the 
regulations was a debate that should be happening in a variety 
of venues, and taking into consideration factors such as 
cyclical industries or what not. But that was not necessarily 
an area in which — that was not within my jurisdiction. 

CHAIRMAN LOCKYER: That's a fair answer. 

Looks like Senator Beverly doesn't have any questions. 

SENATOR BEVERLY: No questions. 

CHAIRMAN LOCKYER: I guess I did get a note that, just 
for record, we need to mention. You've seen this, too. 

It is claimed that there was a problem with EDD 
submission for Title IV (c) funds for veterans CHIPRA employment 
programs that would have received some federal match. 

Can you help us understand this whole thing? 

MS. BRADSHAW: I ' d be happy to. 

We applied for the Title IV (c) grant, which is, as you 
say, the veterans grants. I believe the memo that you got said 



58 

that there was an untimely filing. That, in fact, is untrue. 
In fact, it was hand-delivered, so it was filed on time. 

We were not issued a grant, even though we were rated 
at number one last year and basically the same grant. We did 
not receive it this year, as did several other — five, I 
believe -- other states who also received grants last year did 
not receive them this year. 

We have appealed that decision by DOL, and we are 
providing the grant moneys through alternative means so that our 
veterans are not without their training. 

CHAIRMAN LOCKYER: It's what, a million? 

MS. BRADSHAW: It's 850,000. 

CHAIRMAN LOCKYER: You don't think there'll be any 
program interruption? 

MS. BRADSHAW: We're trying to make sure that there's 
no program interruption. 

CHAIRMAN LOCKYER: Anything that needs to be done to 
assist with that effort? 

MS. BRADSHAW: Well, we, in conjunction with the other 
states, have filed an appeal because in fact one of states who 
received a grant this year also received one last year and was 
substandard even by DOL's estimation. 

CHAIRMAN LOCKYER: Who was that? 

MS. BRADSHAW: Hawaii. In fact, some states received 
grants where their total veteran population is less than 50,000, 
and of course we have several million in the State of 
California. 

CHAIRMAN LOCKYER: Probably Hawaii has as lot, I would 



59 



guess. Maybe -- 

MS. BRADSHAW: But there were problems with their 
program. 

CHAIRMAN LOCKYER: What do you think went wrong? Why 
did this occur? 

MS. BRADSHAW: I don't know. What's why we've 
appealed. In fact, we're in the process of discovery now to 
find out the basis. 

CHAIRMAN LOCKYER: How long does it take to resolve? 

MS. BRADSHAW: I don't know. There's not that many 
appeals. I believe it should be sometime after the first of the 
year. 

CHAIRMAN LOCKYER: I should also mention that I've had 
the opportunity to discuss with you Helix , Neiman-Marcus and 
Cuadra. 

MS. BRADSHAW: Right. 

CHAIRMAN LOCKYER: So, I'm not going into each of those 
cases because it seemed to me that you were able to explain the 
policy or decisions that were made and actions taken or not 
taken as either consistent with law or prior to your service. 

MS. BRADSHAW: What ever combinations. 

CHAIRMAN LOCKYER: Different reasons in each case. But 
I want to mention them so that people know that we're not 
ignoring those matters. 

Okay, anyone present who wishes to comment? Somebody 
does, okay. 

MR. ROSS: Mr. Chairman, Members of the Board, my name 
is Gary Ross. I'm the legislative representative for the 



60 



Department of California American Legion. 

And at our last convention, our Employment Committee 
and our Commissions all agreed that we want to support. 

CHAIRMAN LOCKYER: Okay, so there's a number of you 
present that are in the support category. Any opposition 
present? These are supporters? Okay. 

MR. HARPER: Mr. Chairman, Members of the review 
committee, my name is Don Harper. I am with the California 
Employers Advisory Council. I am Chair of the Veterans 
Statewide Committee. 

The Council and the Veterans Committee strongly 
supports Vicky Bradshaw for this important post, running EDD. 
She's come to our board meetings over the past six months and 
explained her game plan, what she wants to do with the 
Department, and we strongly support her confirmation today. 

CHAIRMAN LOCKYER: Thank you, sir. 

MS. BROYLES: Mr. Chairman and Members, I'm Julie 
Broyles from the California Chamber of Commerce. 

We're here speaking in strong support of Vicky's 
confirmation as Director of EDD. We have found in previous work 
with her while she was the Labor Commissioner, as well as with 
her current duties with EDD, has always strived to be a fair and 
equitable person to work with, has tried very hard to see that 
there are customers on all sides, whether it's employees, 
unemployed workers, whether it's the employers, or people who 
are just entering the job market. 

We have found that she has always looked to enforcement 
of current law, especially, again, when she was the Labor 



61 

Commissioner. We worked with her on the targeted inspection 
program and with the underground Strike Task Force Advisory 
group and again found her arguments very, very compelling that 
it is not fair, if you have people working under the table and 
underground, in trying to make sure that California is as 
competitive as it possibly can be. 

We've also had the opportunity to work with Vicky on 
the Work Force Prep issues. We've worked with her on School to 
Career. We have worked with her in the Office of Work Force 
Policy. We've been able to work with her on the One Stop career 
center, and again, have been impressed that she's trying to make 
sure that everyone has equal access to supply new jobs and 
additional jobs to the California economy and make sure that 
employers can find the workers that they need to make California 
profitable as well. 

For all of these reasons, we would ask for your support 
of her as the Director of EDD. 

CHAIRMAN LOCKYER: Thank you. 

I'd like to kind of limit the speeches, but mostly get 
people on the record. 

MR. CORONA: Fine, Mr. Chairman. My name is Burt 
Corona. I am the Executive Director of Hermandad Mexicana 
Nacional, which is the largest association, membership 
organization, of undocumented, documented citizen immigrants. 
We have in our ranks all the immigrant populations that are 
Spanish speaking. We provide services, assistance through 
counties and through the state and the federal programs. 

We support very whole-heartedly the confirmation of Ms. 



62 

Bradshaw. We observed her during her tenure as Labor 
Commissioner, and we found her to be very fair, and very strong 
for enforcement against violation of all the laws. 

So, our organization is very, very much in support of 
her nomination. 

CHAIRMAN LOCKYER: Thank you. 

MR. WASHINGTON: Mr. Chairman, Members, Willie 
Washington with the California Manufacturers Association. 

We are also in support of Ms. Bradshaw as Director of 
EDD for many of the same reasons that have already been 
articulated. 

CHAIRMAN LOCKYER: Thank you. 

MS. MORALES: Mr. Chairman and Members of the Rules 
Committee, my name is Marga Morales. I'm Deputy Labor 
Commissioner, one, out of the Targeted Industries Partnership 
Program, commonly known as TIPP. I've served the Division for 
16 years and under four different commissioners. 

I would like to say with respect to Vicky Bradshaw, I 
would like to describe her as visionary, committed to her 
employees, courageous in the face of internal and external 
opposition, and an example of dedication. I personally have 
experienced under Vicky Bradshaw as the Labor Commissioner 
sensitivity to my needs for time off with my family, support of 
my efforts with legal advice and technical equipment, and 
communication of her appreciation for our efforts. 

I'd like to conclude by saying that it's been an honor 
to serve under Vicky Bradshaw, and I request your approval. 

Thank you. 



63 

CHAIRMAN LOCKYER: Thank you. 

MR. MILLAN: Mr. Chairman, Members of the Committee, my 
name is Jose Millan. I'm Assistant Labor Commissioner with the 
State of California. 

It's been my pleasure and honor to serve Vicky Bradshaw 
as the State Labor Commissioner. She is one of the fairest, 
most honest, trustworthy people I've ever known. 

She also had the good taste and judgement to promote me 
to a managerial position. That shows her dedication to 
rewarding state service on the basis of merit. 

CHAIRMAN LOCKYER: Are you an exempt or civil service? 

MR. MILLAN: Civil service, sir. 

And she has a very keen knack of doing the most 
wonderful things with fewer resources. She rises to every 
challenge, and I expect her to do the same as Director of EDD. 
I urge her confirmation. 

CHAIRMAN LOCKYER: How much time did you spend in your 
work assignments where you had to work together regularly? 

MR. MILLAN: With Vicky Bradshaw? 

CHAIRMAN LOCKYER: Yes, how frequent was contact? 

MR. MILLAN: Frequent. I worked with her five days, 
six days, seven days a week. 

CHAIRMAN LOCKYER: So, virtually every day of the 
year? 

MR. MILLAN: Yes, virtually every day of the year. 

CHAIRMAN LOCKYER: I just want to be honest about this. 
I have a funny reaction. It's like someone ran their 
fingernails down the blackboard. 



64 

I wonder about how that is for someone in personnel 
practices, frankly, because it's just a style thing that 
shouldn't be sufficient, other than the fact that she's been 
haughty with various of my employees and I resent it. 

But you worked with her, and you didn't pick that kind 
of stuff up? 

MR. MILLAN: Not at all. She is actually not a haughty 
person at all. 

CHAIRMAN LOCKYER: Well, she has been whenever she's 
had dealings with the Legislature universally. So, that's a 
problem. 

But it's separate from that. It's just some kind of 
chemistry thing that's like, I wouldn't want to be around this 
person very much. That's fine. She can be in a different 
building somewhere, as far as I'm concerned, and do her job. 

But there's just something that gets me. Is this crazy 
to say? I don't know what it is. 

Anyhow, someone who was a daily contact, daily 
subordinate employee, it was cool. 

MR. MILLAN: Cool. 

She has very high standards, and she expects people to 
meet them. 

CHAIRMAN LOCKYER: That's okay. That's good. 

MR. MILLAN: Thank you. 

CHAIRMAN LOCKYER: Sorry to be so frank about these 
assessments, but I guess you understand. It's part of my job. 

MS. SAPIEN: I'm Hermelinda Sapien, Deputy Director Of 
the Center for Employment Training. I have been with CET for 28 



65 



years. 

I am here to voice support for Victoria Bradshaw. 
Early in her appointment/ she spent a whole day at the Center 
for Employment and Training, getting to know staff and students, 
and we feel that she has really made a commitment to help 
farmworkers in advancing their training opportunities. 

CHAIRMAN LOCKYER: How did they do it? How did they 
help/ other than spending a day there? 

MS. SAPIEN: Her Department has made sure that 
Title III funds, which have been geared to train dislocated 
workers, that farmworkers get a share of that. 

CHAIRMAN LOCKYER: Was that not true prior? 

MS. SAPIEN: No, it had not happened before. 

CHAIRMAN LOCKYER: How much funding comes that way? 

MS. SAPIEN: To our program, close to $3 million. We 
serve 18 counties. 

CHAIRMAN LOCKYER: I think I'd support her in that 
circumstance, too. Thank you. 

Who's next? 

MR. FLORES: Good afternoon. Honorable Chairman. 

CHAIRMAN LOCKYER: Everybody has a pin. All these 
people have a pin that come up here. 

MR. FLORES: Would you like this pin. 

CHAIRMAN LOCKYER: No, no. I'm just curious what they 
all are. 

MR. FLORES: It's our association and our individual 
agencies. 

CHAIRMAN LOCKYER: They're pretty. 



66 

MR. FLORES : Honorable Chairman and distinguished 
Senators of the Committee/ thank you for the opportunity to 
address you today. My name is Ernie Flores. ' I'm here today 
representing La Cooperativa Campesina de California. I am Vice 
Chairman of La Cooperativa and also the Executive Director of 
the Central Valley Opportunity Center. That's this pin here. 

I'm here today to speak in support of Victoria 
Bradshaw's appointment to the position of Director of the State 
Employment Development Department. 

La Cooperativa Campesina is a public nonprofit 
corporation that serves as a statewide association for a network 
of community-based organizations. Our membership consists of 
the following agencies: the Center for Employment and Training; 
California Human Development Corporation; the Central Valley 
Opportunities Center; Proteus, Inc.; and Employers Training and 
Resource Center. We cover the entire state with services, 
employment training services, educational services, support 
services, social services, housing and other services to migrant 
and seasonal farmworkers and other low-income persons via 
competitive grants and contracts awarded by various federal, 
state, local, and private organizations. 

The executive staff of La Cooperativa Campesina and its 
member agencies has worked with Victoria Bradshaw for several 
years in her capacity as State Labor Commissioner, member of the 
Farmworker Coordinating Council, and in her current position as 
Director of the Employment Development Department. Throughout 
our professional relationship with Victoria Bradshaw, we have 
found her to be accessible, open-minded, fair, trustworthy and 



67 

honest. Even during those times when she had supported a 
different position than the one advocated by La Cooperativa 
Campesina, she has always been forthright and honorable in her 
decision. 

Accessibility, open and fair mindedness, 
trustworthiness and honesty are traits in an EDD Director that 
should not just be sought or wished for. They are traits that 
are absolutely necessary and vital to the position. Victoria 
Bradshaw possesses those traits, and for that reason I urge you 
to confirm her appointment. 

CHAIRMAN LOCKYER: Senator Petris. 

SENATOR PETRIS: I want to tell everybody that's 
waiting in line, I think you were all in the last row and you 
didn't hear it, but the Chair said the rest of the people coming 
up here, just tell us who you are, your organization, and 
whether you're supporting or opposing. 

Now, we're getting a big, long, very nice, but 
inappropriate under this agenda's time limit, speech. So, I 
would appreciate if you could follow the Chair's instruction. 
Give your name, your organization, and whether you're in favor 
or not. 

We assume you're going to say nice things about her or 
you wouldn't be in favor. We haven't heard the noes; there 
probably aren't any. Anyway, that's a given. 

It's just to identify the various people and 
organizations who are lining up. We've got a long 
agenda. 

MR. FLORES: I am in support. 



68 

SENATOR PETRIS: With all due respect, I wanted to make 
that observation. 

CHAIRMAN LOCKYER: Thank you. Senator, for helping 
maintain our schedule. 

I heard one thing I wanted to ask about, which is, 
despite the fact that you you've disagreed with her decisions, 
what's an example? 

MR. FLORES: Well, funding for the Title III migrant 
and seasonal farmworker program. Maybe some of the programs on 
the Farmworker Coordinating Council where we — the constituency 
that we serve, where we wanted more programs made available that 
might not have come to be. 

The decisions were always honest and forthright. We 
didn't always get what we were advocating for. Those types of 
things . 

CHAIRMAN LOCKYER: Was there more than there used to 
be? 

MR. FLORES: Oh, yes, definitely. The Title III 
programs are demonstration and pilot programs. It's the first 
time for that type of funding, and we're having a lot of success 
with those programs. 

CHAIRMAN LOCKYER: I very much like what the 
Cooperativa does. Good luck to you, sir. 

MR. FLORES: Thank you. Senator. 

MS. BRADSHAW: I'll be happy to give you an EDD pin 
also, if you'd like. 

CHAIRMAN LOCKYER: You didn't wear one. 

MS. BRADSHAW: No, I didn't wear one today, but I'll be 



69 

happy to supply you with one. 

MR. ORTIZ: I'm George Ortiz. I'm the Corporate 
President of the California Human Development Corporation, also 
Chair of the Western Lands of Farmworker Advocates, which is an 
that covers five states in western United States. Also, I'm a 
member of the California Farmworker Coordinating Services 
Council. That's where I met Vicky Bradshaw some years back. 

To make it short, we're very much, the people I 
represent, very much in favor of her appointment and her 
confirmation. 

CHAIRMAN LOCKYER: Thank you, sir. 

You've got two pins. 

MR. BIRD: Good afternoon, Mr. Chairman and esteemed 
Members of the panel. 

Just for your edification and illumination, the upper 
pin is a Marine Corps. 

CHAIRMAN LOCKYER: That one I could tell. 

MR. BIRD: Good, that's good. I'm glad our eyesight 
has improved. 

The second one is the pin that denotes the Vietnam 
Veterans of California, and that's the emblem of an organization 
which I work for. 

Today I'm here as President of the Veterans Employment 
Committee here in Sacramento. And we firmly support Vicky 
Bradshaw, and we urge you to make her confirmation. 

You might -- many of you might have heard that there's 
a phrase in the Marine Corps is called "Gung Ho." Usually it 
means somebody that's very assertive and very committed works 



70 



hard. 

But also/ you may not know, is that "Gung Ho" is really 
a Chinese word, and it means working together. I think Vicky 
Bradshaw meets both of those. She's very — she's willing to 
work together with a lot of people. 

She was very decisive in making the decision to put the 
other moneys available for the IV (c) programs here in 
California. Without her, it may have taken a long time or may 
not have happened. 

So, with that, I commend your confirmation. Thank 
you. 

MR. WILLIAMS: Mr. Chairman and Members of the 
Committee, I'll make this the speech about my size, short, right 
to the point. 

I am Charles Williams, Chairperson for Northern 
California Veterans Employment Committee, which includes 14 
counties of veterans. 

We strongly urge you to approve the confirmation. She 
has shown at various meetings that she has attended of our 
committee that she is an advocate for veterans, and we certainly 
need that. I need not tell you the plight of the veterans. 

Thank you. 

CHAIRMAN LOCKYER: Thank you, sir. Oh, a question. 

SENATOR PETRIS: Question. 

I'd like to have your address before you leave. My 
employment in my present capacity is soon terminating, and I 
want to know where to go to file as a veteran. 

[Laughter. ] 



71 

MR. WILLIAMS: All right. Currently/ as soon as you 
become unemployed/ I would suggest strongly that you go to the 
Richmond Employment office, and you look for one of the VERs. 
If they're not available, I'll leave you my card and you can 
contact me. 

SENATOR PETRIS: Thank you very much. 

MR. WILLIAMS: You're welcome. 

CHAIRMAN LOCKYER: Next, please. 

MR. JONES: Mr. Senator, Members of the Committee, my 
name Michael Jones. I'm the Director of Research and 
Development with Proteus, Incorporated, and also the Secretary 
of the Board of Directors of the Association of Farmworker 
Opportunity Programs. 

I'm here this afternoon to express my support for Vicky 
Bradshaw, and my wish that your Committee support her 
confirmation. 

And if you could, I'd like to leave some written 
comments. 

CHAIRMAN LOCKYER: Certainly. Give them to the 
Sergeant. 

MR. JONES: Thank you. Senator. 

CHAIRMAN LOCKYER: Thank you very much. 

MR. REECE: Good afternoon, Mr. Chairman, fellow 
Senators. I'm here as the — count them all. 

CHAIRMAN LOCKYER: About 12? 

MR. REECE: I'm here as the State Employment Committee 
Member for the AmVets. We strongly endorse and support 
Victoria. 



72 

CHAIRMAN LOCKYER: What's this one. 

MR. REECE: That's the Vietnam Veterans Memorial, made 
from the Memorial itself. 

CHAIRMAN LOCKYER: Very nice. You're supportive? 

MR. REECE: Absolutely, yes. 

CHAIRMAN LOCKYER: Next. 

MR. HALSEY: Thank you, Mr. Chairman and Members. 

I represent the Disabled American Veterans as its past 
State Commander and its 105,000 Members. 

We strongly support the appointment of Vicky Bradshaw. 

Two of my colleagues had to leave early to catch a 
flight, but they did want to let you know that they were here. 
That's Peter Cameron with the Vietnam Vets of California, and 
also Rich Bartelow, the Operations Manager for the Vietnam Vets 
of San Diego. They fully support Vicky's confirmation. I think 
you have letters to that effect. 

CHAIRMAN LOCKYER: Yes, we do. Thank you. 

The IV (c) money, obviously there was some grants to the 
Farmworker Employment and Displaced Worker Program. 

Had the money, the total amount, expanded, or were 
there diversions from programs that used to receive funding? 

MS. BRADSHAW: No, it came out of Governor's 40 percent 
discretionary money. Those we set aside for situations such as 
the farmworkers. The One Stop is another example where we set 
aside specific funds for that. 

CHAIRMAN LOCKYER: My question is, were there losers? 
Is there some program that used get funded that didn't, or did 
the total amount of money expand. 



73 

Usually we hear from losers, but we haven't heard 
complaints. 

MS. BRADSHAW: No, because what we're trying to do is 
manage the money more effectively, and we're going after 
national moneys more frequently, or as many times as we possibly 
can. 

CHAIRMAN LOCKYER: So that the pot expanded? 

MS. BRADSHAW: Our pot actually is not more than it was 
last year. We're just trying to find better ways of managing it 
so that in fact we get more bang for the buck, in fact, going 
after other grants in addition to just using our 40 percent 
discretionary money, and using the discretionary money where we 
truly have discretion. 

CHAIRMAN LOCKYER: But the discretionary money didn't 
expand. 

MS. BRADSHAW: No, it didn't. 

CHAIRMAN LOCKYER: But there was other new money 
brought in? 

MS. BRADSHAW: We're looking — right. For instance, 
we're doing collaboration with multiple SDAs, going after 
National Reserve Account grants, those kind of things, so that 
we have, hopefully, access for more moneys. 

But the 40 percent did not expand. 

CHAIRMAN LOCKYER: Within the 40 percent pot of money, 
were there programs that used to be funded that were cut? 

MS. BRADSHAW: Not so far, but we're only in- certain 
process of the year. 

They have to use up their formulaic money. They get 60 



74 

percent of the 40 percent grants, plus they get Title II moneys, 
and they have to use up -- each SDA has to use up their own 60 
percent before they can apply for a 40 percent. So, it really 
is determined at the local level. 

People who may have applied last year for discretionary 
money may not need it this year. 

CHAIRMAN LOCKYER: Okay, other questions from Members. 

Did you want to close, say anything in closing? 

MS. BRADSHAW: No. 

CHAIRMAN LOCKYER: What I'm going to recommend to the 
Committee, particularly to the employer lobbyists who are 
present who have made their opinions known, I'd recommend that 
they get busy working the Assembly on the SDI measure. That's 
obviously not related to this confirmation, but something that 
just came to mind that I ought to recommend to you. 

I'd just like to take a little time to read through and 
think about the testimony, allow others that may want to come 
forward and offer comments to do that before we go to vote, I 
would assume before the end of the month. 

Thank you. 

SENATOR AYALA: When does her term expire? 

CHAIRMAN LOCKYER: December. 

MS. BRADSHAW: December third. 

CHAIRMAN LOCKYER: When are we back? 

MS. BRADSHAW: December second. 

CHAIRMAN LOCKYER: That gives us a lot of time. I 
think we can deal with it before the end of August. 

Those that have been unhelpful in the Assembly might 



75 

decide to get a little more helpful if they expect us to act on 
things they care about. 
Thank you. 

[Thereupon. This portion of the 
Senate Rules Committee hearing was 
terminated at approximately 5:25 P.M.] 
— ooOoo — 



76 
CERTIFICATE OF SHORTHAND REPORTER 

I, EVELYN J. MIZAK, a Shorthand Reporter of the State 
of California, do hereby certify: 

That I am a disinterested person herein; that the 
foregoing transcript of the Senate Rules Committee hearing was 
reported verbatim in shorthand by me, Evelyn J. Mizak, and 
thereafter transcribed into typewriting. 

I further certify that I am not of counsel or 
attorney for any of the parties to said hearing, nor in any way 
interested in the outcome of said hearing. 

jj IN WITNESS^WHEREOF, I have hereunto set my hand this 



(^l^Jl day of /VvJ^.^^^ . 




1996. 






EVELYN J.'^IZi 
Shorthand Reporter 



310-R 

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